Green Finance - Environmental Audit Committee Contents

2  Providing information to direct finance

Risk appetite

14. The Low Carbon Finance Group differentiated banks from three other types of institutional investors—pension funds and insurance companies, sovereign wealth funds, and listed collective investment schemes.[19] But for all types of investor, whether providing equity or debt, investment hinges on the balance of risk and reward. Northumbrian Water believed that high levels of risk meant that that balance was often unfavourable for green investments:

    Financiers broadly fall into two categories: Banks that make loans and Institutional investors that tend to buy listed, rated bonds. Banks and Institutional investors are similar in the sense that they primarily make decisions to invest their capital based on risk vs. return and there are a number of common themes that mean the perception of risk (principally political risk) in green finance is often higher than in alternatives.[20]

15. Michael Liebreich of Bloomberg New Energy Finance saw, however, that the balance of risk and reward was changing, and leading to a wider shift in the energy sector:

    The energy system is changing. There is a phased change from the old school centralised fossil and nuclear related power system to something that is renewables, lots more efficiency, smart grid, gas, some nuclear, and so on. That change is happening partly because of lots of small legislative interventions, partly because of the underlying economics in the energy sector. I think that is a long-term trend.[21]

The dependence on regulatory frameworks and technological innovation was emphasised by James Vaccaro of Triodos Bank:

    Renewable energy ... is quite attractive to banks when there is a stable enough regulatory environment and the technology is proven. There is now a good European-based infrastructure for operation and manufacture.[22]

RenewableUK highlighted that investment decisions are based on "long term, low-risk returns on investment within a diversified portfolio".[23] Ian Simm of Impax Asset Management saw three factors at work:

    We have seen a progressive increase—in fact, we would argue almost an exponential increase-in private sector capital coming into renewable energy projects in the UK over the last five years, first of all as institutional investors have sought out more exposure to infrastructure. Secondly, they have fewer opportunities to make money elsewhere in their portfolios because cash returns are low and bond yields are very low. Thirdly, they are increasingly comfortable with the regulatory framework that the Renewables Obligation has provided-with some modifications and evolution, but consistently—since the early part of the last decade.[24]

16. The risk profile of particular renewables projects varies. Ian Simm told us that:

    If you then look to other types of green investments or green project, many of them fall down on technology risk. Onshore wind is typically seen as low-risk, proven technology where the pension fund has a very low likelihood of losing money because the equipment does not work. If you could switch over to some of the more emerging marine technologies like wave or tidal, although there has been strong progress in those areas, they are still not effective with the consistency and reliability that the pension funds will need to see.[25]

Risks also vary depending on the project stage—project development, pre-construction, construction and operations. Different investors are willing to take on green investments at different stages of the project. A significant amount of the cost of green infrastructure projects is up-front which, as Josh Ryan-Collins of the New Economics Foundation explained, is also the most uncertain stage, with no guarantee that the project will reach full operation:

    The cost of renewable energy infrastructure is very, very high at the outset, which makes the lifetime cost appear prohibitive, but of course the real lifetime costs are much lower for renewable energy because it is free. It comes from the sun. It is that initial up-front cost that is creating the problem, and that is where the barrier is. You have to have investment. I do not think it is enough to rely on pension providers to do that.[26]

17. Donald MacDonald from the BT Pension Scheme concluded that the risk profile of these early stages can be too high for pension funds and institutional investors who tend to favour low-risk, long-term investments with secure returns:

    The large pension schemes will tend to look for the very large and boring investments rather than small investments. Small investments are probably better for pooled vehicles where a whole number of different projects can be wrapped up by a single manager with perhaps a number of clients.[27]

On the other hand, private equity and infrastructure funds, with a higher risk appetite, typically finance the initial costs of project development and construction, and subsequently sell these investments on to other investors seeking stable longer-term returns. We heard from pension funds that "having a larger pipeline of projects that we could invest in, that were up and running to the point where they met our risk profile better, would certainly be good".[28]

18. Whatever the risk appetite of particular types of investor, the level of risk is influenced by the information available to them. Michael Mainelli of Z/Yen told us that there is a need for "long finance", but identified two obstacles to its supply: "One is policy mistrust and the second is information gaps."[29] In a similar vein, the Committee on Climate Change identified in May 2013 how Government energy policy-making could be adjusted to improve the conditions for investment.[30] In the absence of the measures it proposed (paragraph 23), the Committee concluded that "there is a risk that current sources of finance will be insufficient to deliver the increased levels of investment required in a low-carbon portfolio".[31] It noted financing constraints for both the energy companies and investors:

    Even if the investment climate can be improved, there remain questions about whether finance would be forthcoming for required investments. In particular, large amounts of finance are required, while balance sheet strength of energy companies may be limited, and appetite of banks and institutional investors for project finance is unclear. ... In the absence of finance backed by balance sheets, investment might proceed using project finance—where debt is secured against future project cash flows. However, appetite from banks and institutional investors to provide project finance during the early stages of projects where risks are high is unclear, and likely to be even harder to secure until new market arrangements are proven. ... The risk is that finance becomes a binding constraint on the level of investment in low-carbon technologies.[32]

Regulatory certainty

19. Because many green investments have a long planning phase, it is important that investors are clear not just about when regulatory decisions are going to be made but about the likely future direction of Government policy. Stephanie Maier of Aviva Investors told us that "where you have stable, predictable, simple policy, we can make investment decisions in that context."[33] Mike Turnbull of Bank of America Merrill Lynch highlighted that the Government has had a good record of giving investors confidence by setting out a clear framework, but that recent policy reviews had caused concerns:

    Pension funds and insurance companies want to invest in transparent, sustainable cash flows and regulatory instability or lack of consistency—and we have been renowned as one of the most consistent and one of the longest-standing regulatory environments for energy, particularly electricity and water—and there is more anxiety around that now than there has been for some time.[34]

Ian Simm of Impax Asset Management told us that "policy uncertainty and political uncertainty around future projects has a dampening effect on project development activity today. ... When there is policy and political change in this type of infrastructure area, there is almost invariably a hiatus created."[35] Investors needed certainty and stability not just for prospective projects but also for those already in operation:

    ... it is absolutely essential ... that there are no retrospective changes to support in any form, and that includes taxation for existing infrastructure assets. If that is not possible, then there will be a very direct consequence—the risk appetite for future investments among the private sector will drop.[36]

20. These risks can be particularly significant for community investment projects (which we discuss further in Part 3). We heard from Mike Smyth of Energy4All and Wey Valley Solar Schools, who told us:

    One of our schools went through 10 regulatory changes before we built the panels. That gives you an idea of the extraordinary uncertainty and why people drop out in droves, normally having lost time and money. At the moment it has settled down for solar for communities. The problems are difficult on wind because of longer timescales, and the renewable heat incentive, which frankly has not worked as well as it should have done, has complete uncertainty built into it. Broadly, the rates can be changed at any time without any criteria applying. On a project that might take a year or 18 months to deliver, you do not know what the end point is and that is one reason why there has been a low uptake.[37]

21. James Vacarro from Triodos Bank told us this may be one reason why community energy had not become more widespread in the UK. Against a background of "quite destabilising" changes in Feed-in Tariffs and Contracts for Difference:

    ... you do not get enough people entering the process with the confidence that there is going to be something at the end of it and, if reviews are taking place every year but it takes two or three years to develop a project, that specific factor means that not enough people are forming the habits.[38]

22. DECC highlighted initiatives which they considered would stimulate green finance: Electricity Market Reform, including Contracts for Difference and Capacity Market payments, and an escalating carbon price floor.[39] They stated that these "provide the longer term institutional and financial structure to attract investment into energy infrastructure."[40] We identified flaws in aspects of these programmes in our December 2013 report on Energy Subsidies, noting for example that gas will be the only energy technology eligible for capacity payments when they begin in 2018-19, and that on current proposals by the European Commission renewables feed-in tariffs would not be driven by the need to meet a UK renewables target after 2020.[41]

23. The City of London Corporation highlighted the possibility of using index-linked carbon bonds to underwrite the risk associated with investment in an uncertain policy environment. This would align the incentives for government and investors together for a stable policy environment, so that "if governments fail to meet their green targets, they pay a higher interest rate on the bond".[42] The Committee on Climate Change listed in May 2013 a number of measures that it considered the Government should take to provide greater certainty for investors and "a strong signal about the future direction of travel for the power system in order to support supply-chain investment, which has long payback periods, and development of new projects, which have long lead times".[43] Those measures included:

·  introducing a carbon-intensity target for electricity generation (previously recommended by the Committee) before the 2016 timeframe currently planned by the Government;[44] and

·  extending the Levy Control Framework, which covers feed-in tariffs for renewables and nuclear, beyond 2020 to 2030 (the Committee assessed the current £8 billion a year Levy provision to be "broadly sufficient" but uncertainty beyond 2020 was limiting investment).[45]

24. The Committee on Climate Change acknowledged that "investment conditions in the UK power sector will be improved in the long run by the introduction of long-term contracts (Contracts for Difference) ... and by the setting of the Levy Control Framework."[46] Subsequently, in December 2013, the Government announced the strike prices for different types of renewable energy, but the Minister suggested in a speech that he was intending to end subsidies for onshore wind.[47] He told us:

    You may be placing a little more weight on ministerial remarks and statements and speeches than those speeches can bear. What matters is the strike price itself. The strike price is there, it is final, they have been published for each year and everybody can draw their conclusions from it. [48]

However, in January 2014, the Government announced more detailed plans for Contracts for Difference and Feed-in Tariffs which differentiated more 'established' technologies, including onshore wind below 5MW, which "should be subject to immediate competition through a competitive process of CfD allocation".[49] James Vaccaro told us that such media speculation could have an impact on investor confidence:

    At the moment there are some of these perception-reality things, and the reporting of the green levies, which is nothing to do with renewable energy and renewable energy targets, undermines confidence in the regime in people's minds.[50]

The Prime Minister's announcement in October 2013 of a review of energy bills, which we examined in our report on Energy Subsidies,[51] was however new and unexpected. The resulting delay in the implementation of part of the Energy Company Obligation scheme has had an impact on the energy efficiency market and the collapse of a number of schemes to insulate hard to treat homes.

25. As we have highlighted in previous inquiries, a significant barrier to investment in low-carbon energy has been uncertainty for potential investors about the future direction of Government policy. The Government's Electricity Market Reform, including the contracts for difference and capacity market regimes, though flawed, provide an opportunity for greater policy stability in future. The Government should make the changes recommended by the Committee on Climate Change to bring greater longer-term certainty for investment—an early energy-intensity target for electricity generation and an extension of the Levy Control Framework and indicative funding levels to 2030. The Government should reiterate its commitment to the already planned escalation of the carbon price floor and use the implementation of the Electricity Market Reform to make a clear commitment to avoiding further unplanned regulatory and subsidy changes for low-carbon energy.

Providing investors with information to assess risk

26. We first examined the risks of a 'carbon bubble' in fossil fuel energy company stocks in our May 2012 Green Economy report.[52] Awareness of such a bubble would be an important factor for investors to consider their exposure to the risks associated with unburnable assets. However, many investors lack the information to adequately factor carbon risk into their investment decision-making.


27. Dr Nicola Ranger from the Grantham Research Institute told that the "total amount of reserves of oil, gas and coal, currently held by both states and listed companies, far exceeds what we call the 'carbon budget' that would allow us to keep global temperatures to below 2 or 3 degrees".[53] Since our 2012 report, the Grantham Research Institute and Carbon Tracker have published further analysis of the carbon bubble. Their report, Wasted Capital and Stranded Assets, concluded that "60-80% of coal, oil and gas reserves of listed firms are unburnable".[54]

28. Dr Ranger believed that "investing in these [fossil fuel] companies that are potentially at risk from stranded assets in the future could be a high-risk strategy for them, so investing in other areas might be better in terms of the returns".[55] The London stock market has become 7% more exposed to coal since 2011.[56] Mark Campanale of Carbon Tracker told us that " two-thirds of the revenues of the FTSE 350 is based on three sectors: finance, oil and gas and mining. If these valuations are wrong then we are putting our banking system and the London capital markets at risk from significant changes to the fossil fuel demand."[57] Other analysts, such as HSBC, have also identified such risks:

    Because of its long-term nature, we doubt the market is pricing in the risk of a loss of value from this issue ... Capital-intensive, high-cost projects, such as heavy oil and oil sands, are most at risk ..."[58]

Michael Liebreich of Bloomberg New Energy Finance, similarly, foresaw "some rather messy adjustments":

    I think it is probably more analogous to sub-prime than to any sort of bubble, where you hold these assets, you think they are good, and suddenly it becomes clear that they are not. At that point, the readjustment, the rebalancing of portfolios and so on, feeds on itself as people undertake fire sales to rebalance and then that pushes down the market values even further below book values.[59]

29. We heard different views about when such a readjustment would take place. Ian Simm of Impax Asset Management told us that the most likely way that a carbon bubble would "feed through to destruction of value" would be "through the imposition of carbon taxes or carbon prices, as they affect the break-even point of carbon resource extraction".[60] The City of London Corporation told us "There is a very real risk of a carbon bubble", but added that "the policy and legal changes required for it to burst are complex and largely reliant on international agreement."[61] David Russell of the Universities Superannuation Scheme questioned whether policymakers would in fact act to implement policies that cause a bubble to burst, citing the failure of the EU Emissions Trading System.[62] However, James Leaton of Carbon Tracker believed that an existing "patchwork of regulation" meant that a carbon bubble was not dependent on a "whether or not we get a global deal in 2015".[63]

30. Michael Liebreich told us that he thought it was important to "understand the dynamic of the system much better",[64] and said there was a role for higher reporting requirements and 'stress testing':

    There are believable scenarios where you could see a rapid adjustment. Whether it is an oil price drop, whether it is a bad hurricane season, leading to the Americans moving more quickly on policy, there are scenarios where you can see quite a rapid adjustment. I would certainly suggest stress tests to look at: does that mean that people start breaching covenants? Having to engage in fire sales? What does it do? Are there other contagion issues? Can one rebalance portfolios? One should at least be looking at that. So I think disclosure and stress tests would be the first thing.[65]

Stephanie Maier of Aviva Investors told us that there are potentially serious long-term issues if capital is misallocated, and the Bank of England has a responsibility to investigate the potential impact of climate change.

    When you look at the proportion of the FTSE 100 that is invested in these energy-intensive, carbon-intensive stocks, it is potentially a more systemic issue than that. One of the things we like to see the Bank of England do is assess the extent of climate change and the high-carbon exposure that the UK has, and what impact that has on financial stability. If it is a systemic risk, how do you start addressing it? We do not want to see a point where you fall off the cliff and these assets become devalued. You want to find a way to understand the true value of these assets.[66]

31. We asked the Bank of England whether they considered the carbon bubble to be a risk and how they were monitoring it. They told us that the Financial Policy Committee met regularly to review the risks to UK financial stability and that it had not identified risks to financial stability from a carbon bubble.[67] This follows a Bank of England response on a carbon bubble risk in February 2012, when it noted that "there could be such a risk if the impact of policies aimed at reducing returns in high carbon areas were not already being priced into the market".[68] The Financial Policy Committee of the Bank of England should regularly consult with the Committee on Climate Change to help it monitor the risks to financial stability associated with a carbon bubble.


32. Investors get some of the information they need from companies' annual reports and accounts. The Government has introduced regulations to replace the requirement on quoted companies to publish a 'business review' with a requirement to produce a 'strategic report'.[69] These regulations include a requirement to provide information on the company's environmental impact to the extent that this affects the development, performance and position of the company. The regulations also implement the Government's commitment (as announced at the June 2012 'Rio+20' UN Summit) to introduce mandatory reporting of greenhouse gas emissions by UK companies.[70] In our October 2011 report on Preparations for the Rio+20 Summit, we concluded that while many companies had identified that sustainable development was in their own interests, others needed to be incentivised to fully address the environmental and social aspects of sustainable development, and we recommended that the Government should push for Rio+20 to agree a mandatory regime for sustainability reporting.[71] And in our June 2013 report on the Outcomes of the Summit we welcomed the Government's decision to introduce mandatory emissions reporting for large UK-listed companies announced at the Summit.[72]

33. Stephanie Maier of Aviva Investors highlighted the benefits of carbon reporting in terms of driving more sustainable behaviour by companies.[73] Michael Mainelli told us that environmental reporting could become more sophisticated in identifying "sustainability risks",[74] to allow investors to more fully understand those risks. Some companies are also using 'shadow pricing' to manage these risks in their operations.[75] The UN has set out Principles for Responsible Investment,[76] and there are a number of international initiatives to improve the quality of information available to investors to assess the sustainability of investments, including 'financed emissions'—carbon produced as a result of a company's financial investments.[77]

34. James Leaton of Carbon Tracker told us that requiring companies to provide detailed reports on their exposure to carbon would help inform investors:

    The financial system, and the regulator ... need to send stronger signals to the market to factor in these risks to enable investors to shift capital. That relates to greater transparency around the carbon content of reserves that companies have an interest in, and also asking those companies to stress test their business model against different warming scenarios from 2 degrees upwards.[78]

Aviva Investors told us that they would like all large companies to report on their material sustainability issues through their reports and accounts to allow investors to easily assess whether all potential risks have been taken into account. Despite the UK's narrative reporting requirements, their assessment ranked London 14th amongst the world stock exchanges in terms of sustainability disclosure. They considered that a standard for Stewardship, similar to the ISO standard on environmental management, would raise the credibility of the stewardship work that fund managers undertake.[79]

35. New carbon reporting arrangements for companies can help investors understand carbon impacts, and could help stimulate greater focus on these issues amongst customers and suppliers to help add pressure on companies to adopt more sustainable practices. The Government should work with companies to ensure that reporting requirements provide investors with all of the information they require to assess carbon risk, and develop the standard reporting requirements further.

Fiduciary duty

36. ShareAction told us that some investors cite 'fiduciary duty', the legal requirement to act solely in another party's interests, as a reason for not factoring the impacts of climate change into their investment strategies. "Fiduciary investors will wish to ensure that they are looking after ... savers' long-term best interests."[80] James Leaton of Carbon Tracker believed however that short-term considerations were given priority over long-term stability:

    [The] whole system has various short-term drivers, whether it is the performance incentives for the fund managers based on quarterly performance, the recommendations from analysts, which are based again on the short-term revenue flows from that company and their ability to generate revenues in the short term. So that is not very good at factoring in long-term risks. To them, 'long-term' is perhaps more than a year or more than three years, and that does not necessarily reflect the investment strategy of some of those large institutional investors, the pension funds.[81]

37. In 2012, the Kay Review of Equity markets and long-term decision-making recommended that the Law Commission review guidance on fiduciary duty. The Law Commission expect to publish their conclusions by June 2014,[82] although its 'initial views' published in May 2013 were that "despite the uncertainty of this area of law ... any attempts to codify fiduciary duties would be impractical."[83] ShareAction nevertheless believed that:

    legislative clarification is needed to confirm that there is no legal bar to trustees focussing on long-term, sustainable wealth creation, and that trustees can take into account their beneficiaries' wider non-financial interests provided that this is prudent.[84]

38. Ian Simm of Impax Asset Management told us that as an asset manager he had "quite limited room for manoeuvre", and described how the mandates given by pension funds, including target returns, were "tightly specified".[85] Donald McDonald, head of the BT Pension Fund, also told us that their primary duty was to ensure that "the right pension is paid to the right people at the right time", but explained that as they were investing for people who would draw pensions in many years time, "climate change is a major risk factor that has to be taken into consideration." He stressed the need to take a balanced approach to manage risk across many in different future scenarios.[86] The BT Pension Fund had set up a 'carbon-tilted index':

    We take the FTSE All-Share Index but we then introduce a tilt factor into that to reduce the carbon exposure. Basically, that is tracking or doing very slightly better than the normal index, but with 18% less carbon.[87]

Catherine Howarth of ShareAction concluded that the Law Commission needs to give further guidance on this area:

    The evidence coming out of pension schemes is that in fact they take a very narrow view and are very confused about what the law allows them to do, so we are presenting the Commission with evidence that in practice, on the ground, pension fund trustees feel quite constrained and that they might be in breach of legal obligation if they do not take a very narrow view.[88]

39. UK Sustainable Investment and Finance told us "sustainable and responsible investment is becoming increasingly popular owing to growing awareness that it is difficult to separate issues of financial return and risk from topics such as the environmental/carbon impact, energy security or other factors."[89] The Law Commission observed that studies have shown a link between Environmental Social and Governance (ESG) factors and performance, and concluded that "the answer is clearly that pension trustees may use wider factors":

    ... an ESG driven approach is not simply about avoiding the next company crisis. It works on the basis that companies do better in the long term if they are well-run and sustainable, and have loyal suppliers, customers and employees. Thus ESG factors in this context are about improving financial outcomes for the beneficiaries: they are not about ethical preferences.[90]

40. However, the key question is the extent to which investors must take these factors into account. The Kay Review (paragraph 37) concluded that "institutional investors acting in the best interests of their clients should consider the environmental and social impact of companies' activities".[91] The Law Commission suggested that investors would not have to implement an approach that takes into account ESG factors, but should at least show that they have considered it:

    We think that this is a sensible conclusion. Even if the duty of adequate consideration does not require this, trustees are also under a duty of care. As part of this duty, we think that trustees should consider, in general terms, whether their policy will be to take account of ESG factors in their decision-making, bearing in mind the resources available to them. The law, however, allows trustees discretion not to take an ESG approach if after due consideration they consider that another strategy would better serve the interests of their beneficiaries.[92]

All investors are required to follow a fiduciary duty in their investment decisions, but that can be interpreted in different ways by different investors. It is important that investors factor the risks of exposure to carbon into their decision-making and consider the climate impacts of investments, as part of their wider social and environmental responsibilities.

19   Low Carbon Finance Group, Submission to the European Union: A framework for climate and energy policiesBack

20   Ev w1, para 2 Back

21   Q40  Back

22   Q200 Back

23   Ev w20, para 18 Back

24   Q166 Back

25   Q169 Back

26   Q171 Back

27   Q59 Back

28   Q168 Back

29   Ev 73 Back

30   Committee on Climate Change Next steps on electricity market reform, (May 2013), p9 Back

31   Committee on Climate Change Next steps on electricity market reform, (May 2013), p12 Back

32   Committee on Climate Change Next steps on electricity market reform, (May 2013), pp55-56 Back

33   Q172 Back

34   Ev 79 Back

35   Q172 Back

36   Q172 Back

37   Q211 Back

38   Q192 Back

39   Ev 95  Back

40   DECC Electricity market reform: Allocation of Contracts for Difference, January 2014, para 20 Back

41   Environmental Audit Committee, Ninth Report of Session 2013-14, Energy Subsidies,HC 61 Back

42   Ev w43, para 15 Back

43   Committee on Climate Change Next steps on electricity market reform (May 2013), p8 Back

44   Committee on Climate Change Next steps on electricity market reform (May 2013, p54 Back

45   Committee on Climate Change Next steps on electricity market reform (May 2013), p49 Back

46   Committee on Climate Change Next steps on electricity market reform (May 2013), p49 Back

47   Speech to the Spectator Energy Conference, December 2013  Back

48   Q256 Back

49   Department of Energy and Climate Change, Electricity Market Reform: Allocation of Contracts for Difference (January 2014), p11 Back

50   Q210 Back

51   Environmental Audit Committee, Ninth Report of Session 2013-14, Energy Subsidies, HC 61 Back

52   Environmental Audit Committee, Twelfth Report of Session 2010-12 A Green Economy, HC 1025 Back

53   Q2 Back

54   Carbon Tracker and Grantham Institute on Climate Change and the Environment, Unburnable Carbon 2013: Wasted capital and stranded assets, p4 Back

55   Q4 Back

56   Carbon Tracker and Grantham Institute on Climate Change and the Environment Unburnable Carbon 2013: Wasted capital and stranded assets, p4 Back

57   Ev 72 Back

58   HSBC, Oil & carbon revisited: Value at risk from 'unburnable reserves (January 2013)  Back

59   Q42 Back

60   Q171 Back

61   Ev w42, para 11 Back

62   Q48  Back

63   Q7 Back

64   Q63 Back

65   Q63 Back

66   Q171 Back

67   Ev w47  Back

68   Environmental Audit Committee, Twelfth Report of Session 2010-12, A Green Economy, HC 1025, para 70 Back

69   The Companies Act 2006 (Strategic Report and Directors' report) Regulations 2013  Back

70   All UK companies listed on the Main Market of the London Stock Exchange. It excludes non-UK registered companies, companies listed on AIM and privately owned companies. Back

71   Environmental Audit Committee, Eighth Report of Session 2010-12 Preparations for the Rio +20 Summit, HC 1026  Back

72   Environmental Audit Committee, Second Report of Session 2013-14 Outcomes of the UN Rio +20 Earth Summit, HC 200 Back

73   Q154 Back

74   Ev 74 Back

75   Carbon Disclosure Project Use of internal carbon price by companies as incentive and strategic planning tool, (December 2013) Back

76   United Nations Principles for Responsible Investment (  Back

77   These are counted as 'scope 3' emissions and are not included in current reporting requirements. Back

78   Q3 Back

79   Ev 112 Back

80   Share Action Green Light report- Resilient portfolios in an uncertain world, p2  Back

81   Q26  Back

82   The Law Commission  Back

83   The Law Commission Consultation Paper 215 Fiduciary Duties of investment intermediaries (2013) Back

84   Ev 97 Back

85   Q177 Back

86   Q45 Back

87   Q51 Back

88   Q179 Back

89   Ev w39 Back

90   The Law Commission Consultation Paper 215 Fiduciary Duties of investment intermediaries (2013), p146 Back

91   J Kay, The Kay Review of UK Equity Markets and Long-Term Decision Making: Final Report (2012), para 10.20. Back

92   The Law Commission Consultation Paper 215 Fiduciary Duties of investment intermediaries (2013), para 10.66 Back

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Prepared 6 March 2014