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Socially Responsible Investment
Climate change criteria tightened up on FTSE4Good indices
FTSE Group has tightened
up the criteria for its
FTSE4Good
corporate responsibility index series, toughening the climate change code of
conduct companies must meet if they are to remain in the index.
The new benchmarks, which will be phased in over the next two
years, are based on a climate change consultation FTSE undertook during 2006 and
which received over 100 responses from corporations, fund managers, NGOs and
private investors. FTSE estimated that of the 250 companies identified as having
the greatest impact on climate change, less than 50 are expected to already meet
the new requirements on strategy, system, disclosure and performance.
Mark Kenber, policy director at
The Climate Group,
welcomed the new criteria, arguing that incorporating sustainable behaviour into
business practice is in the long-term interests of stakeholders. Kenber
recognised that meeting these requirements will not be easy, but said he was
convinced the effort would result in positive economic and environmental
impacts.
The Guardian’s
Julia Finch (6 February) said that while FTSE4Good’s demand to cut carbon
emissions must be applauded, a 2.5% target seems to lack ambition – BT, for
instance, has plans for a 65% cut. While FTSE4Good argues setting a higher level
would have resulted in too many expulsions from the index, and that this is only
a starting level, Finch suggested that with ever more lurid headlines warning of
the danger of carbon emissions, a bolder start should surely have been
attempted.
Links
FTSE Group
FTSE4Good Corporate Responsibility Index Series
The Climate group
The Guardian
March 2007 |
