2009 Conference

Overview

On 2 November 2009 more than 100 top executives from around the world met at UN Headquarters in New York to explore how the world’s exchanges can work together with investors, regulators, and companies to enhance corporate transparency, and ultimately performance, on ESG (environmental, social and corporate governance) issues and encourage responsible long-term approaches to investment.

This unique event, co-hosted by the UN-backed Principles for Responsible Investment Initiative (PRI), UN Global Compact and the United Nations Conference on Trade and Development (UNCTAD), examined the various ways in which stock exchanges promote sustainable business practices. Examples included existing best practices such as enhanced sustainability reporting requirements for listed companies and the establishment of ESG indices.

A number of stock exchanges are becoming increasingly active in raising awareness of ESG issues and standards among listed companies, driven by calls from institutional investors through initiatives like the UNEP Finance Initiative and the PRI.

In a video message to open the meeting, UN Secretary-General Ban Ki-moon said that environmental, social and governance issues were critical in creating a world economy that was more stable, inclusive and sustainable. Mr. Ban told participants, “Stock exchanges and other financial bodies and institutions have a key role to play. Many of you have taken important steps to advance this agenda. I welcome your efforts to incorporate ESG considerations into new stock indexes, listing rules and regulatory frameworks. I hope today’s discussions will inspire you to go further still.”

PRI signatories such as Aviva Investors, Fonds de réserve pour les retraites (FRR), and PREVI spoke openly about the ways in which investors and exchanges could work together to address this agenda. One of the six Principles of the PRI calls for signatories to “seek appropriate disclosure on ESG issues by the entities in which they invest”.

A number of exchanges showcased how they already implement ESG strategies by enhancing listing rules and disclosure requirements, setting up ESG indices and launching new exchanges for ESG-related asset classes such as carbon.

Supachai Panitchpakdi, Secretary-General of UNCTAD said: “We welcome the work already done by many exchanges on this issue and this collaborative dialogue sends an important signal to listing authorities around the world that they play an important role in promoting the ESG agenda. UNCTAD research shows clearly that disclosure requirements can have a significant impact on the transparency and long-term sustainability of companies around the world”.

James Gifford, Executive Director of PRI, explained, “The global financial crisis convinced many investors and policymakers of the urgent need to promote better risk management, good governance and enhanced transparency to protect long-term returns. Any moves to improve corporate disclosure on ESG issues are likely to benefit exchanges through enhancing both the reputation of markets and the investability of the companies traded on them”.

One of the many high-profile investors speaking at the conference was Paul Abberley, Chief Executive of Aviva Investors in London. In November 2008, Aviva Investors called for a debate on how stock market listing authorities could help promote increased corporate transparency. Mr. Abberley said, “We are extremely pleased with our collaboration with the United Nations and have high hopes that today’s conference will play a catalytic role in promoting more sustainable business behaviour. Our main focus is on promoting a global listing environment that requires companies to consider how responsible and sustainable their business model is, and also encourages them to put a forward-looking sustainability strategy to the vote at their AGM”.

A copy of Paul Abberley’s speech is available here.

Speakers

  • Georg Kell, Executive Director, UN Global Compact
  • Supachai Panitchpakdi, Secretary-General, UNCTAD
  • Antoine de Salins, Executive Director, Fonds de Reserve pour les Retraites (FRR)
  • Paul Abberley, Chief Executive, Aviva Investors London
  • Peter Clifford, Deputy Secretary General, World Federation of Exchanges (WFE)
  • Serge Harry, Executive Vice President NYSE Euronext, Chairman & CEO BlueNext
  • David J. Vidal, Director of Research, Global Corporate Citizenship, Director, Center for Corporate Citizenship & Sustainability, The Conference Board
  • Alyson Warhurst, Executive Chair, Maplecroft
  • Jane Diplock, Chairman, International Organisation of Securities Commissions (IOSCO) and Chairman, New Zealand Securities Commission
  • Maged Shawky Sourial, Chairman, Egyptian Stock Exchange
  • Jothimani K. Muniand, Head, Market Intelligence, Bursa Malaysia
  • John Wilson, Director of Corporate Governance, TIAA-CREF
  • Edemir Pinto, Chief Executive Officer and President, BM&FBOVESPA – Securities, Commodities and Futures Exchange
  • Michel Maquil, President, Luxembourg Stock Exchange
  • Ito Warsito, President Director, Indonesian Stock Exchange
  • Corli le Roux, Legal Counsel, Head of SRI Index, Johannesburg Stock Exchange
  • Tamzin Ractliffe, Global Social Investment Exchange (GSIX)
  • Fábio Moser, Chief Investment Officer, PREVI
  • Paul Abberley, Chief Executive, Aviva Investors London
  • Hüseyin Erkan, Chairman and CEO, Istanbul Stock Exchange
  • James Gifford, Executive Director, PRI

Agenda

Changing capital markets: emerging trends in responsible investment and the ESG agenda.

  • Evolution of responsible investment and corporate ESG agenda, and the UN’s work in this area.
  • How are mainstream asset owners and managers addressing ESG-related risks and opportunities in their investments?
  • How are responsible investors raising standards of ESG performance among the companies they own?
  • How are leading companies responding?
  • What are the biggest challenges investors and companies are facing in delivering high standards of ESG performance?

Speakers:

  • Georg Kell, Executive Director, UN Global Compact
  • Supachai Panitchpakdi, Secretary-General, UNCTAD
  • Antoine de Salins, Executive Director, Fonds de Reserve pour les Retraites (FRR)
Exchanges and the ESG agenda – the state of play.How are exchanges addressing ESG issues to date? Summary of the various initiatives being undertaken by exchanges around on the world around ESG issues, including:

  • Raising standards through listing rules and capacity building among companies.
  • Emergence of ESG indices
  • New trading opportunities for ESG-focused assets (carbon, microfinance, social enterprises)

Speakers:

  • Peter Clifford, Deputy Secretary General, World Federation of Exchanges (WFE)
  • Serge Harry, Executive Vice President NYSE Euronext, Chairman & CEO BlueNext
  • David J. Vidal, Director of Research, Global Corporate Citizenship, Director, Center for Corporate Citizenship & Sustainability, The Conference Board
  • Alyson Warhurst, Executive Chair, Maplecroft
How exchanges and regulators can enhance ESG transparency.

  • ESG disclosure requirements in listing rules
  • Regulatory requirements relating to ESG transparency
  • Option for enhancing ESG transparency – what is the balance between exchanges’ rules and regulation?
  • Do alternative trading platforms and interbank trading undermine ESG transparency?
  • Will regulations responding to the financial crisis assist the market in delivering more ESG disclosure?

Moderator:

  • Marc Gunther, Contributing editor, FORTUNE Magazine

Speakers:

  • Paul Abberley, Chief Executive, Aviva Investors London
  • Jane Diplock, Chairman, International Organisation of Securities Commissions (IOSCO) and Chairman, New Zealand Securities Commission
  • Maged Shawky Sourial, Chairman, Egyptian Stock Exchange
  • Jothimani K. Muniand, Head, Market Intelligence, Bursa Malaysia
  • John Wilson, Director of Corporate Governance, TIAA-CREF
New opportunities: ESG indices and trading in ESG-focused investments.

  • ESG indices as a business opportunity for exchanges. How can they be commercialized?
  • Are ESG indices a driver of corporate transparency?
  • Do investors see ESG indices as a useful tool for developing fund products?
  • How are ESG indices changing? Is there a move from an SRI to a broader ESG focus?
  • Opportunities in emerging ESG alternatives: Carbon credits, forest bonds, social business, microfinance, sustainable infrastructure

Moderator:

  • Marc Gunther, Contributing editor, FORTUNE Magazine

Speakers:

  • Edemir Pinto, Chief Executive Officer and President, BM&FBOVESPA – Securities, Commodities and Futures Exchange
  • Michel Maquil, President, Luxembourg Stock Exchange
  • Ito Warsito, President Director, Indonesian Stock Exchange
  • Corli le Roux, Legal Counsel, Head of SRI Index, Johannesburg Stock Exchange
  • Tamzin Ractliffe, Global Social Investment Exchange (GSIX)
The way forward: Collaboration between exchanges and investors on the ESG agenda.

  • How can exchanges and investors work together to promote the ESG agenda (raising standards, etc.)?
  • How can exchanges play a bigger role in supporting ESG agenda?
  • How can exchanges benefit from working with the UN through the Global Compact, UNCTAD and the PRI?
  • What would signing the PRI mean for an exchange?
  • Next steps

Moderator:

  • Marc Gunther, Contributing editor, FORTUNE Magazine

Speakers:

  • Fábio Moser, Chief Investment Officer, PREVI
  • Paul Abberley, Chief Executive, Aviva Investors London
  • Hüseyin Erkan, Chairman and CEO, Istanbul Stock Exchange
  • James Gifford, Executive Director, PRI

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