We have expanded the list of climate policies we assess company engagement with to incorporate land-use related policy, referring to legislative or regulatory measures to enhance and protect ecosystems and land where carbon is being stored. Assessments under this category are currently underweighted in terms of their contribution to the overall company metrics. This weighting will be progressively increased over the next 6 months.
We adjusted the terminology used to describe the queries running down the left-hand side of our scoring matrix and added additional explanatory text to the info-boxes. This has no impact on the scores and methodology. It has been done following user feedback to improve clarity.
The Institutional Investors Group on Climate Change (IIGCC) appears to be advocating for ambitious sustainable finance policy.
IIGCC has been very vocal in its support of aligning finance with the Paris Agreement and the EU's 2050 net-zero target. IIGCC has also supported the need for measures to address short-termism in markets.
In 2020, IIGCC advocated for an ambitious update to the Non-Financial Reporting Directive in a joint statement to policymakers and in feedback to the European Commission. In 2021, IIGCC supported ambitious mandatory climate-related financial disclosures in feedback to the UK’s Department for Business, Energy and Industrial Strategy.
In 2018-19, IIGCC engaged broadly positively on the taxonomy regulation, supporting the regulation although also conveying concerns from some investors that it may be overly prescriptive. In response to a UK Treasury consultation in 2020, IIGCC supported the need for a UK taxonomy. In 2021, IIGCC actively supported the scientific basis of the EU taxonomy, writing to the Commission to oppose any weakening of the policy. IIGCC has not taken a clear position on the possible expansion of the taxonomy to environmentally harmful activities.
In feedback to the European Commission's consultation on the Renewed Sustainable Finance Strategy in 2020, IIGCC advocated for the EU to increase its ambition in sustainable finance regulation. It also advocated for guidelines for sustainability-linked bonds and loans, as well as stronger verification mechanisms of the EU Green Bonds. IIGCC has also supported the integration and reporting for pension providers around ESG issues, and further EU action in ESG stress testing. However, in feedback to the European Supervisory Authorities on the Sustainable Finance Disclosure Regulation in 2020, IIGCC raised concerns about the number of mandatory indicators and the proposed implementation timeline.