------------------------------------------------------------------------ Issue 33 October 2004 http://www.unepfi.net/ebulletin "There is no business to be done on a dead planet" - David R. Brower - EVENT OUTCOMES 1. SECOND MEETING OF THE CENTRAL AND EASTERN EUROPEAN TASK FORCE 2. UNEP FI RENEWABLE ENERGY FINANCE WORKSHOP 3. UNEP FI SPECIAL ADVISOR DELIVERS KEYNOTE SPEECH AT WWF JAPAN CONFERENCE ON CLIMATE CHANGE MEMBER SHOWCASE 4. SWISS RE CONFIRMED AS DJSI INSURANCE SECTOR LEADERS FOR THE FOURTH YEAR RUNNING 5. SOCIETE GENERALE GROUP RELEASE REPORT ON SUSTAINABLE DEVELOPMENT 6. AXA PUBLISH THEIR FIRST ACTIVITY AND SUSTAINABLE DEVELOPMENT REPORT ACTIVITIES 7. LAUNCH OF THE SUSTAINABILITY BANKING IN AFRICA REPORT 8. ASSET MANAGEMENT WORKING GROUP PLANS, 2004/2005 WORKSTREAM 9. FOURTH UNEP FI - GRI WORKING GROUP MEETING 10. RISKS OF WATER SCARCITY: A BUSINESS CASE FOR FINANCIAL INSTITUTIONS EVENT WIRE 11. CORPORATE NON-FINANCAIL REPORTING, HARNESSING THE BENEFITS 12. EU EMISSIONS TRADING 2004 13. 2004 AUSTRALIAN ETHICAL INVESTMENT CONFERENCE 14. ENVIRONMENTAL FINANCE 2004 NEWS 15. RUSSIA DECISION ON RATIFICATION - MAJOR STEP TOWARDS ENTRY INTO FORCE OF KYOTO PROTOCOL 16. A DEADLY HURRICANE SEASON 17. SOCIALLY RESPOSIBLE INVESTMENT GROWS IN JAPAN AS FTSE4GOOD LAUNCHES NEW INDEX EVENT OUTCOMES 1. Second meeting of the Central and Eastern European Task Force On September 27-28, the Central and Eastern European Task Force (CEETF) gathered, in Budapest, for their second meeting following the kick-off meeting in May in Sofia, Bulgaria. Participants included the following task force members: Bank Austria Creditanstalt, EBRD; HVB, Komercni Banka; Raiffeisen Zentralbank Austria; Regional Environmental Centre for Central and Eastern Europe; Vertis Environmental Finance. The task force also welcomed new participants, OTP, West LB Hungaria and the Hungarian Association for Environmentally Aware Management. Due to the huge differences in economic development inherent in the region the task force decided to form two subgroups for its further activities. One group will deal with new EU states and the Balkans, the other subgroup will focus on the particular needs of Russia and states of the former Soviet Union. From June until August the CEETF undertook a survey on finance and sustainability in Central and Eastern Europe (CEE) that identify the main fields of interest in sustainable finance among CEE financial institutions as well as drivers, barriers and experienced benefits. The summary of the study can be downloaded at: http://www.unepfi.net/ceetf . The results of the study resulted in the work programme for 2005 that will focus on further awareness raising and setting up a training program. As environmental credit risk was identified as the main sustainability issue by the CEE financial institutions surveyed, the task force will also push forward the implementation of the environmental credit risk platform for CEE. For further information contact: Regina Kessler: regina.kessler@unep.ch 2. UNEP FI Renewable Energy Finance Workshop in Budapest The Renewable Energy Finance Workshop that UNEP FI held in collaboration with SEFI attracted more than 90 participants from the international and domestic financial sector, NGOs, project developers and governmental agencies. The aim of the day was to inform and discuss about the potential and challenges of financing renewable energy projects in the countries of Central and Eastern Europe (CEE). Presentations were held by key players in the renewable energy field, such as Bank Austria Creditanstalt, Fortis Bank and OTP Bank. UNEP FI took the opportunity to promote the activities of its Central and Eastern Task Force. Mark King (EBRD), the Chair of the Central and Eastern European Task Force, presented the planned activities of the task force and the results of a study undertaken on finance and sustainability in CEE. More information on the study is available at http://www.unepfi.net/ceetf . During the conference OTP Fund Management, the largest fund manager in Hungary, signed the UNEP FI statement as the first asset management company in the CEE region. 3. UNEP FI Special Advisor Delivers Keynote Speech at WWF Japan Conference on Climate Change Mr. Takejiro Sueyoshi, Special Advisor to the UNEP FI Finance Initiative in the Asia Pacific Region, delivered a keynote speech on the role of the financial sector in preventing climate change at the WWF conference on climate change in Tokyo, Japan on 29 September 2004. Mr. Sueyoshi highlighted the important role of financial institutions and emphasised that it was within their corporate social responsibility to fulfil this role. He also presented the findings from the UNEP FI Climate Change Working Group ‘CEO Briefing’ publications on climate risk, emission trading and renewable energy, and introduced the actions taken by some of the UNEP FI signatories. The conference attracted high interest with the expectation of the Russian ratification to the Kyoto Protocol. http://www.wwf.or.jp/join/onemore/events/ev2004092901.htm (Japanese) MEMBER SHOWCASE 4. Swiss Re Confirmed as DJSI Insurance Sector Leader for the Fourth Year Running Swiss Re, who are a member of the UNEP FI Climate Change Working Group, have re-affirmed their position as Insurance Sector leader of the Dow Jones Sustainability Indexes (DJSI) for the second year in a row. The company's strong commitment towards sustainability is supported by its transparent communication on a wide variety of sustainability related issues in reports, press releases and presentations. For more on this report visit: http://www.sustainability-indexes.com/djsi_pdf/djsi_world/CompanyBiographies/Bios05/CBR_Swiss_Re_05.pdf 5. Société Générale Group Release Report on Sustainable Development Société Générale Group has released its third Report on Sustainable Development for 2003 in April 2004. In keeping with the policies outlined in the 2002 Annual Report, the Group reinforced its commitments by signing the Global Compact in 2003. Société Générale Group also continued its efforts to incorporate the following key targets into coherent action plans for its businesses in France and abroad: standardization of its socially responsible practices worldwide, systematic integration of its environmental reporting, and reinforcement of its sponsorship initiatives. The report is available both in English and French. For further information on the report visit: http://www.socgen.com/sg/file/fichierig/documentIG_5197/Sustainable-Development-Annual-Report-2003.pdf 6. AXA Publish Their First Activity and Sustainable Development Report AXA has released its first Activity and Sustainable Development Report for 2003. The first section of this three-part document focuses on how AXA contributes directly to sustainable development. For example, in lending its risk management expertise to industries, and by working closely with corporate clients to identify and implement effective prevention programs, AXA contributes in a meaningful way to sustainable development. The second half showcases AXA’s commitments to its key stakeholders, its customers, its shareholders, its employees, its suppliers, the community and its environmental responsibility. The third part contains a brief summary of the key social ratings attributed to AXA by specialized rating agencies. For further information on the report visit: http://www.axa.com/action_ind/infos_pub/va/doc/Activity_report_2003.pdf ACTIVITIES 7. Launch of the Sustainability Banking in Africa Report The Sustainability Banking in Africa Report, produced by the African Institute of Corporate Citizenship's Centre (AICC) for Sustainability Investing and supported by the UNEP FI ATF, IFC, Finmark Trust and Nedbank, was officially launched on Tuesday 21st September at an AICC Convention in Johannesburg, South Africa. The report identifies a number of innovations arising in sustainability practices within the African financial sector, indicating positive change with respect to non-financial risk management and opportunity creation in the region. Examples of overarching market innovations, more responsible investment initiatives, access to capital, savings and transactions, across 5 African countries (Botswana, Kenya, Nigeria, Senegal & South Africa) are provided within the report. Each of these assist in the promotion of sustainable development as an integral component of overall business strategy for the financial sector throughout the African continent. See the downloadable report at http://www.unepfi.net/atf 8. Asset Management Working Group Plans 2004/2005 Workstream The 12 members of the AMWG are currently reviewing their membership and work programme for 2004/2005. Their work is likely to take two paths. The first will be to outreach the investor community on the recommendations of the Materiality study. The second may be another round of the Materiality study building on the lessons learned from the first project and the recommendations of the UN Global Compact "Who Cares Wins" Report. The group is currently researching how best to act on these projects. The workplan will be finalized by December. For more information visit: http://www.unepfi.net/stocks Or contact: jacob.malthouse@unep.ch 9. Fourth UNEP FI - GRI Working Group Meeting The UNEP FI - GRI Working Group is currently preparing to meet for a fourth time on October 25th and 26th, in Rabobank Offices Utrecht, the Netherlands. The members will review the feedback received from the public consultation process of the draft set of 15 environmental performance indicators, produced by the Working Group earlier this year and designed to assist financial institutions report on the environmental impacts associated with the retail banking, commercial and corporate banking, asset management and insurance sectors, at this meeting. The Working Group aims to finalise this set of indicators, and hence the first pilot version of the GRI Financial Services Sector Supplement, by the end of 2004. For more information contact: Niamh O' Sullivan, niamh.osullivan@unep.ch 10. Risks of Water Scarcity: A Business Case for Financial Institutions UNEP FI will be following up the previous study on the Risks of Water Scarcity: a Business Case for Financial Institutions with a study looking at the investment opportunities for financial institutions in the water sector. This study will serve as an upside story which can help balance and mitigate the identified risk drivers through investments, promoting good business and at the same time promoting water sustainability. Likewise, a policy brief has been proposed to begin bridging the gaps between policy makers and financial institutions relating to water issues. Seeking viable sustainable solutions entails all parties working together in order to address one of the pending challenges for businesses and society as a whole in the years to come, water. Financial institutions and stakeholders are invited to contact the UNEP FI Secretariat or SIWI, if they are interested in obtaining further information about the project. For further information contact: Alberto Pacheco Capella: alberto.pacheco@unep.ch or Johan Kuylenstierna: johan.kuylenstierna@siwi.org EVENT WIRE 11. Corporate Non-Financial Reporting, Harnessing the Benefits London, November 23-24 Brought to you by Ethical Corporation, this conference will cover the key issues to give you the key tools to make your non-financial reporting more relevant, more useful and more believable to all your stakeholders. Companies already confirmed to speak include BP, McDonald's, Fujitsu, HGB Group, mm02, National Grid Transco, The Body Shop, Westpac, and many more. For more information on this conference, please visit http://www.ethicalcorp.com/reporting 12. EU Emissions Trading 2004 Brussels, 20 & 21 October 2004 This conference, from Environmental Finance Publications, will provide an in-depth examination of the EU ETS - the implications for industry and the environment, outstanding problems/concerns, prospects for trading activity and carbon prices. PLUS case studies from major affected companies. For Further Information visit: http://www.environmental-finance.com 13. 2004 Australian Ethical Investment Association Conference Melbourne, 14 & 15 October 2004 This year’s Australian Ethical Investment Association Conference aims to quantify the financial impact of environmental, social and governance issues on portfolio risk and return. The Conference will explore the nexus between sustainability and stock price embracing a broad range of issues which are having a significant impact upon shareholder value. These issues include: corporate fraud and mismanagement, the cost of carbon, weather related disasters, water scarcity, environmental accidents, civil and shareholder activism and costly prudential requirements. Keynote speakers include Dr Matthew Kiernan of Innovest Strategic Value Advisors, and Dr Stephen Davis of Governance Metrics International. Filip Corten from Dexia Asset Management will speak about provision of research and the impact of social issues on portfolio value. Also appearing will be members of the Institutional Investors Group on Climate Change (IIGCC) including James Cameron, Chair of the Carbon Disclosure Project. For Further Enquiries: Call Louise O’Halloran: 61 2 8224 0314 or visit: http://www.eia.org.au 14. ENVIRONMENTAL FINANCE 2004 This is a series of four half-day workshops on the 28th October in Toronto, Canada, directed at investors and fund managers. The objective is to cover a broad range of topics to provide investors with enough knowledge about the potential impact of environmental issues on corporate value so that they can make sound judgments about investments and ask the important questions at shareholder meetings. - What information should be demanded in the management's discussion and analysis? - How should corporations be reporting and meeting their fiduciary duties related to off balance sheet risks? - Effect of environmental exposure on the cost of capital. - Implementation options for incorporating environmental issues in investment strategies. For further information: http://www.environmental-finance.utoronto.ca NEWS 15. Russian decision on ratification - major step towards entry into force of Kyoto Protocol 30 September - The decision of the Russian cabinet to forward the 1997 Kyoto Protocol on climate change to the Russian Parliament (or Duma) for ratification will - if the Duma moves to adopt - re-energize international cooperation on cutting greenhouse gas emissions, the Executive Secretary of the United Nations Climate Change Convention said. For more on this story: http://unfccc.int/files/press/news_room/press_releases_and_advisories/application/pdf/pr040930.pdf 16. A Deadly Hurricane Season This year has proved to be one of the worst hurricane seasons on record. Four major storms, Charley, Frances, Ivan, and Jeanne, hit Central and North America during the months of August and September, killing more than 1,500 and leaving hundreds of thousands homeless. While none of them has been as severe as Hurricane Andrew, their arrival in quick succession has inflicted heavy cumulative damage across the region. Not surprisingly, these deadly storms have had a negative impact on the world's insurers and reinsurers. Swiss Re, Munich Re, Hannover Rueckversicherung AG and other European reinsurers had their 2004 earnings estimates lowered by UBS AG because of claims resulting from this year's hurricanes. Profit at reinsurers has been undermined by the storms during the costliest year for U.S. natural catastrophes in at least a decade. However, reinsurers expect to benefit next year as higher claims keep insurance prices from falling after a surge in rates since the September 11, 2001, attacks in the U.S. According to Munich Re, total economic damage from all the storms combined will amount to about $50 billion, while insured damages are estimated at $20 billion to $35 billion. Meanwhile, the Insurance Information Institute estimates insured losses could reach around $21.7 billion breaking the record set by Hurricane Andrew in 1992. The cost of repairing the damage caused by Andrew triggered the bankruptcy of 12 home insurance companies in the US and pushed many of the syndicates that make up the Lloyd's of London insurance market close to financial collapse. The insurance industry has since reduced its exposure to hurricane damage, with government-backed bodies increasingly underwriting losses in the most vulnerable regions and by spreading the risk to reinsurers. As a result, analysts believe that a repeat of the financial crisis that hit the industry in the wake of Hurricane Andrew is unlikely. Source: Various Publications 17. Socially Responsible Investment Grows in Japan as FTSE4Good Launches New Index by William Baue Source - SocialFunds.com FTSE4Good unveils the second SRI index covering the Japanese market exclusively. In late August 2003, the global socially responsible investment (SRI) index provider FTSE4Good had no "plans for specifically covering the Japan market in the pipeline," according to Sandra Steel, head of external relations for the FTSE Group. Indicative of the substantial growth of SRI in Japan recently, such plans travelled the entire length of the pipeline over the past 12 months, from conception through development to the birth of the FTSE4Good Japan Index earlier this week. http://www.socialfunds.com/news/article.cgi/article1522.html To unsubscribe: email: LISTSERV@peach.ease.lsoft.com and in the body of the email type "signoff UNEPFI" To subscribe: email: LISTSERV@peach.ease.lsoft.com and in the body of the email type "subscribe UNEP FI" END. The UNEP FI e-bulletin is a monthly publication of the United Nations Environment Programme Finance Initiative. United Nations Environment Programme Division of Technology, Industry and Economics Economics and Trade Branch Finance Initiative Unit Chief Editor: Paul Clements-Hunt Editor: Henry Thomas henry.thomas@unep.ch Disclaimer: The views expressed in this publication are not necessarily those of UNEP or UNEP FI, or of its signatories, nor does UNEP FI or its signatories take any responsibility for actions taken as a result of views or opinions expressed in this publication. Copyright 2004 - UNEP FI