Publisher's note
Toby is the CEO and co-founder of Corporate Knights Inc. and publisher of Corporate Knights Magazine. He spearheaded the first global ranking of the world’s 100 most sustainable corporations in 2005, and in 2007 coined the term “clean capitalism.”

Corporate transparency

Improving sustainability disclosure requirements

Considerable effort goes into sustainability reporting, but to what end? On the critical issue of climate change, we now have a potentially game-changing answer from finance ministers: to protect the financial system.

Last year, G20 finance ministers asked the Financial Stability Board (FSB) to consider how the financial sector could take account of the risks climate change poses to our financial system. The upshot is an FSB climate task force report due later this year that will recommend consistent climate-related financial risk disclosures. The recommendations will penetrate the financial mainstream standard-setters in a way that previous efforts by NGOs could not. The G20’s Green Finance Study Group, created under China’s presidency, provides a valuable forum for such recommendations to be taken up.

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Mind the gap

Building an energy bridge to the future

Kermit the Frog famously said it’s not easy being green. Today, it might be easier being green than being a CEO in the oil business.

Fifty-two oil companies have already filed for bankruptcy this year, and over one-third of the world’s biggest oil and gas companies could end up bankrupt in 2016 under stress from crushing debt loads (over US$150 billion) and lacklustre cash flows depressed by low oil prices, according to a recent study by Deloitte.

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Pension tension

When it comes to tackling climate change risks, Canadian pension funds are dangerously out of touch.

Dear Mr. King:

As representatives of Labour in the House of Commons, may we ask whether it is your intention to introduce at this session legislation with regard to (a) Provision for the unemployed; (b) Old Age Pensions. We are venturing to send a similar inquiry to the leader of the opposition.

Yours sincerely,

J.S. Woodsworth

A.A. Heaps

Ninety years ago, my great grandfather A.A. Heaps and J.S. Woodsworth, the two lone labour members of Parliament, sent the above now famous letter to Prime Minister Mackenzie King. King was sympathetic philosophically to old age pensions, and in a receptive mood pragmatically given that he needed the support of Heaps and Woodsworth in the minority parliament. A deal was struck. When King’s government won a strong mandate in the 1926 election following the bizarre King-Byng affair, he made good on his promise by introducing legislation that became the Old Age Pensions Act in 1927. It entitled British subjects aged 70 or over who had lived in Canada for 20 years to a maximum of $20 per month.

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Defending divestment

By Bob Litterman and Toby A.A. Heaps
The intersection of fiduciary duty and climate change.

Many investors today are trying to understand what climate change implies for their portfolios. Does market efficiency indicate they should hold market cap weighted indexes, or do expected impacts on valuations suggest another course of action?

Meanwhile, stakeholders are raising questions and putting pressure on asset owners. Some are motivated by concerns about ethical issues and consistency with mission; others are purely focused on risk and expected returns.

There is clearly a moral issue to consider in owning a public company that, for example, spreads misinformation and otherwise deliberately impedes public policy for private gain, but how far does that moral concern spread? Only a few institutions, such as the Rockefeller Brothers Fund, have announced divestment from all fossil fuels on moral grounds.

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Being okay with enough

By Toby A.A. Heaps
By mindfully appreciating the little we need, perhaps we can let go of the insatiable wants leading us astray

True story, Word of Honor:

Joseph Heller, an important and funny writer

now dead,

and I were at a party given by a billionaire

on Shelter Island.

I said, "Joe, how does it make you feel

to know that our host only yesterday

may have made more money

than your novel Catch-22

has earned in its entire history?"

And Joe said, "I've got something he can never have."

And I said, "What on earth could that be, Joe?"

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