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European Green Deal got a shade lighter with elections
What's going on in the world of ESG, CSRD, CSDDD, SDGs etc...
1. EUROPEAN GREEN DEAL GOT A SHADE LIGHTER WITH ELECTIONS
It is not really a surprise; the European Parliament leaned a little to the right last week. That is not usually a good sign for environmental or social advocates.
In reality though it appears that while passing any new environmental or social laws will face more headwinds than before the EU elections, it is unlikely that we will see much regression.
There are a few things at risk though. The goal to reach 90% emissions reductions by 2040 now looks in jeopardy as it still needs to be approved by the EU Parliament.
Plus, the 2035 ban on new petrol and diesel cars, could be under pressure up for review in 2026. Italian PM Meloni is a strong opponent.
Our bigger concern is that any slowdown in Europe might send the wrong signals globally.
Reference: https://www.nytimes.com/2024/06/06/climate/global-elections-climate-change-policy.htm
2. CALIFORNIA GOES AFTER FOSSIL FUEL COMPANIES’ CASH
California’s (CA) lawsuit against fossil fuel companies took a turn this week when California’s Attorney General Rob Bonta said that the state would seek to seize cash from oil and gas companies’ “illegally obtained profits”.
CA has decided to use consumer protection law in this instance. This is part of a lawsuit against ExxonMobil, Chevron, Shell, BP, ConocoPhillips, and the American Petroleum Institute, accusing them of deceiving the public over their role in climate change.
The complaint alleges that the companies have known since the 1960s that burning fossil fuels would warm the planet and change our climate.
The needle is moving. Vermont also adopted a law that orders fossil fuel companies to pay for the climate damage they have caused.
3. WORLD IS ON TRACK TO BREACH 1.5C AT THE END OF THIS DECADE
This is hardly a surprise, but not good news.
Carbon Brief has provided an updated analysis of when the world will exceed the Paris 1.5C limit. The analysis was conducted using the latest global surface temperature data and climate model simulations.
The findings show that, while the best estimate for crossing 1.5C has moved up by approximately two years compared to Carbon Brief’s earlier 2020 analysis, it remains most likely to happen in the late 2020s or early 2030s, rather than in the next few years as some of the headlines suggest.
Please bear in mind this 1.5C breach is in a scenario where emissions are not rapidly cut.
That is the main point. We need to act now.
Reference: https://www.carbonbrief.org/analysis-what-record-global-heat-means-for-breaching-the-1-5c-warming-limit
4. CORPORATES PREPARE FOR CSRD, STRUGGLE WITH RESOURCES
We feel for the CSOs and others who, with limited resources, have to deliver Double Materiality Assessments and CSRD reports, armed with nothing more than spreadsheets.
This PWC report confirms what we have been repeating. You don’t prepare your financials with Excel, so why would you try to produce your sustainability/CSRD report that way?
AI software can help identify the right topics, suggest the right data, and help you find it. This is not a new problem. It has been solved many times before in other domains. I am frustrated by what I am seeing, having been solving this problem for 30+ years. It should start with a contextual data strategy.
The net effect is people are consumed by the reporting, leaving no time to improve, and we do not have time to waste.
Reference: https://www.edie.net/corporates-are-preparing-for-csrd-but-cite-major-headaches-over-data-and-resources
5. NATURE RESTORATION LAW BACK ON AGENDA, TEST FOR GREEN DEAL
We thought back in March and April that the Nature Restoration Law (NRL) was dead. The NRL could reverse decades of drastic biodiversity loss across Europe, but it did not have enough support across the EU.
Then the Germans and Irish got to work on a rescue bid, and secured support of nine other EU states, including France and Spain.
A debate is now set for today (June 17), and it is expected to be robust. A previous vote was abandoned when Hungary changed its position at the last minute and joined Austria, Belgium, Finland, Italy, Netherlands, Poland and Sweden, as non-supporters.
We need just one of these states to change its position, in what will be the first real test for the Green Deal post the elections.
6. TELSTRA ENDS CARBON CREDITS, WITH DIRECT CLIMATE ACTION FOCUS
You may recall the drama surrounding SBTi’s potential inclusion of carbon credits as a part of a company’s path to its SBTi goals.
After a staff revolt, SBTi reversed its position. Then SBTi staff’s research indicated that there was little value in carbon offsets anyway as (part of) a path to SBTi goals.
It is interesting now that Telstra – who had committed to a 1.5C SBTi path – has stated publicly that it is backing away from offsets.
“… we believe redirecting our investments from purchasing carbon credits to taking more direct climate action … will help consumers better understand how we have more direct impact on climate change.”
We would think so. Consumer pressure works.
Reference: https://www.esgtoday.com/telstra-ends-use-of-carbon-credits-to-focus-on-decarbonization-projects/
7. SWISS GOVERNMENT VOTE AGAINST ECHR ‘GRANNY’ RULING
Earlier this year, a landmark case in the European Court of Human Rights (ECHR) sided with 2,000 elderly Swiss women, saying the Government’s climate policies had not done enough to protect their human rights.
But this week, the Swiss Parliament voted against additional climate actions mandated by the court, saying the ECHR should not interfere with Swiss democracy.
This is scandalous.
No country has ever refused a judgment by the ECHR. Switzerland has a legal obligation to implement the ruling. It is a signatory to the European Convention on Human Rights.
The Swiss now have two options: to leave the ECHR, which is unlikely, or to give them a plan by October on how they will enact the ruling.
Reference: https://tinyurl.com/7db3aezk
8. LESS THAN ONE THIRD OF COMPANIES READY FOR ESG ASSURANCE
In what could be another episode of “Here’s why you can’t run your business with Excel”, research from KPMG suggests that less than a third (29%) of companies feel ready to have their ESG data independently assured.
Companies are increasingly coming to the realisation that, just like financial reporting, ESG reporting and the whole CSRD journey, requires systems of record, both for rigour and efficiency, and to act as the assurance reference, to ensure they are compliant.
Leading companies have moved beyond Excel to use smart systems to ease the burden of their Double Materiality Assessment, Data Management, Emissions Calculations, CSRD reporting and Assurance.
Disclosure: Future Planet provides AI-based software to companies across Europe to support their sustainability efforts.
Reference: https://the-cfo.io/2024/06/11/esg-assurance-readiness-kpmg-2024/
9. ESG CONCERNS MAKE OVER 70% COMPANIES ABANDON M&A DEALS
Sustainability considerations are becoming increasingly central in the merger and acquisition (M&A) dealmaking process, with more than 70% of M&A leaders reporting that they have abandoned deals over ESG concerns, according to a Deloitte report.
A vast majority (83%) of respondents said that they would be willing to pay a premium for an asset with a high ESG profile.
Deloitte surveyed 500 M&A leaders from companies with $500M+ in revenue and Private Equity firms with $1B+ in assets under management.
There is a greater recognition among business leaders that ESG is a lever for measuring, protecting, and creating value.
That can only be good.
10. APPLE ACCUSED OF UNDERPAYING FEMALE WORKER IN CALIFORNIA
A lawsuit filed in San Francisco by two women who have worked at Apple for more than a decade claims the company systematically underpays female workers in its engineering, marketing, and AppleCare divisions.
According to the lawsuit, Apple relies on applicants' pay expectations to set their salaries. But because most workers provide a figure that is slightly higher than what they earned at their last job, the practice has the same effect of perpetuating wage disparities.
Apple also rewards employees who are deemed to have "talent" by paying them more but disproportionately grants that designation to men, the plaintiffs claim.
Apple said it is committed to inclusion and has achieved gender pay equity since 2017.
Reference: https://www.dailyclimate.org/mexico-s-elects-its-first-woman-president-2668442585.html
11. AUSTRALIA’S PETER DUTTON PLANS TO AXE 2030 CLIMATE GOALS
This is shocking news. Australia’s coalition leader Peter Dutton told the Weekend Australian he wants to prioritise gas and nuclear power sources over renewables.
Energy Minister Chris Bowen says Peter Dutton’s vow to axe Australia’s 2030 emissions target would be a “wrecking ball” for the country’s relationships with its key foreign partners. The decision would place Australia at odds with its legally binding targets under the 2015 Paris Agreement.
Mr Bowen said a weakened climate emissions goal could leave the nation out of step with Pacific Island states and a significant portion of the international community.
12. GREENPEACE KOALAS PRESS MCDONALDS ON DEFORESTATION
Research commissioned by Greenpeace Australia Pacific (GPAP) found that 668,665 hectares of threatened koala habitat was bulldozed for beef production in the last five years; 2,400 times the size of Sydney city.
The report says that the beef industry in Australia is killing millions of native animals every year, including koalas, wallabies, lizards and birds.
McDonald’s is reportedly the world’s single largest purchaser of beef and one of the biggest buyers of Australian beef, which supplies 65% of McDonald’s stores globally.
Using the koala as its symbol, GPAP is calling on McDonald’s to publicly aim for, and achieve deforestation-free supply chains by 2025.
Reference: https://tinyurl.com/3c54jrm4
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