A handful of snippets for the sustainable investor.
B-Lab, which started the ‘benefit corporation’ or ‘B Corp’ movement, called upon members of the Business Roundtable in the US to become certified B Corps. The Business Roundtable members include many of the CEOs of the largest corporations in the US. Being a benefit corporation allows a corporation to legally consider more than just shareholder interests. For public companies, typically shareholders would have to approve such a change.
JP Morgan – one of the biggest banks in the world – rejected the call, saying that it would not be suitable for the company to become a benefit corporation. Interestingly, they did commission a review to determine the legal implications of making such a move, suggesting that they may have seriously considered it. We think however that the legal review just gives the management a stronger case for not meaningfully bringing the decision to shareholders, at least for now. Having said that, however, we also believe that to ask an enormous and extremely complex and wide-reaching financial institution like JP Morgan to change its legal status is quite an ask. ‘Systemically important’ banks are already having to think about more than just shareholder profit, so it may not be as bad as it sounds that JP Morgan rejected the call from B-Lab. We don’t think they’re saying ‘never’, just ‘not now’.
Meanwhile, Goldman Sachs – another giant bank – joined the OS-Climate initiative which is an “open-source collaboration community to build a software platform that will dramatically boost global capital flows into climate change mitigation and resilience”. Their words, not ours. Aside from Goldman, the other members are Amazon, Allianz, Federated Hermes, Microsoft and S&P Global, making it a cross-industry initiative and therefore wide-reaching if it has its intended effect.
Sustainability digest is a weekly newsletter highlighting a handful of interesting issues facing the sustainable investor.
To the pound 