ESG & Sustainability Newsletter
In this edition
1. News around the world
2. News from the financial services and insurance sector
3. Best Corporate Social Responsibility Practice
4. Events
5. Insights from an Expert
6. Let's get personal - WIACON's short interview
7. Did you know...?
1. News around the world
Experts agree that EU climate targets can only be achieved through technological innovations. The Boston Consulting Group estimates the market potential for low-carbon machinery and equipment by 2040 to be $27 trillion. New regulatory requirements like the CSRD will push companies to act more transparently and environmentally friendly, while public interest in this topic is growing.
The CEO of BlackRock, Larry Fink, has attempted to improve relations with Republican representatives in Texas after the state blacklisted BlackRock for its departure from fossil fuels. Fink spoke at an energy investment summit in Houston, offering to support Texas in securing $10 billion in private investments to strengthen the power grid. More than 100 investors, managing a total of about $2.2 trillion, attended the summit and are expected to support Texas' energy system. BlackRock has already made significant investments in Texan energy projects and continues to operate ESG-oriented funds, although Fink stated last year that he would no longer use the term "ESG" as it had been politically weaponized.
The Council and the European Parliament have provisionally agreed on a regulation on Environmental, Social, and Governance (ESG) ratings to enhance investors' trust in sustainable products. The regulation aims to improve the reliability and comparability of ESG ratings and prevent potential conflicts of interest. It includes admission and transparency requirements for rating providers as well as a simplified registration scheme for small companies.
European Parliament and Council legislators today announced that they have reached a provisional agreement on a directive to delay the adoption of standards for companies to provide sector-specific sustainability disclosures and for sustainability reporting by companies outside the EU under the Corporate Sustainability Reporting Directive (CSRD).
Behavioural and behavioural health promotion measures contribute to the attractiveness of employers. Companies that look after the well-being of their employees not only promote quality of life, but also employee loyalty. In this way, OHM can support the sustainability impact of CSR on the economy, politics and society.
With the increase in extreme weather events around the world, coupled with stringent regulations coming into force, organisations are under constant pressure to respond and explore how they can transform their business to become truly sustainable.
The good news is that for 63% of executives, the business case for sustainability across their organisation is clear, according to a new study. For organisations to transform effectively and successfully, leaders need to be ahead of the curve and aware of the changes taking place to understand how sustainability expectations can shape the future of their business.
BASF is responding to revelations from ZDF and "Spiegel" about employees of their Chinese partner spying on Uighurs. BASF announced its withdrawal from Xinjiang and the sale of its shares in the joint ventures in Korla. Although internal audits found no evidence of human rights violations, they acknowledge "serious allegations" against their partner that contradict their values. The decision follows a meeting with the Inter-Parliamentary Alliance on China (IPAC), which sharply criticized BASF. Experts and EU lawmakers welcome the move as an important signal against oppression in Xinjiang. However, BASF emphasizes that despite the withdrawal, they will continue to be active in China. Critics view the move as purely profit-driven and call for more commitment to human rights.
A meta-study commissioned by the Federal Ministry of Research shows that the effects of digitization on the environment are mixed. Certain applications such as building automation and smart charging have positive effects, while the resource consumption of smart devices and data centers is high. Clear environmental benefits are evident in some areas such as the building and energy sectors, while a strong focus on individual transport in the transportation sector poses problems. The resource consumption of digitization and shifts in emissions must also be considered. However, most studies only quantify CO2 effects, while a comprehensive analysis should also consider other environmental impacts.
2. News from the financial services and insurance sector
The EU is planning to significantly increase the transparency of ESG ratings. The article describes the current problems of non-transparent reports and the EU's plans for greater clarity.
Mr. Berndt points out his own successes in green company pension schemes and shows that cleverly used ESG offers more opportunities than obstacles.
The article sheds light on the "anti-ESG" community, especially in the USA, names backgrounds and people, describes effects and changes.
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3. Best Corporate Social Responsibility Practice
4. Events
WIACON will be part of the Akademie3 conference in Vienna, which will take place from 11.04. to 12.04.2024.
Alicia Buss, ESG Compliance Consultant at WIACON, will give an expert lecture on "Successful integration of ESRS into corporate culture".
Alicia Buss: "The quality of a sustainability report depends on the extent to which a company has integrated environmental protection, social responsibility and exemplary corporate governance into its culture. These values should be an integral part of all corporate activities. In my presentation, I will explain how companies can create a basis for their sustainability report and economic success by consistently applying the ESRS. In particular, the focus will be on the comprehensive responsibility of the company, which requires an awareness of new sustainability standards. Careful planning, effective implementation and regular monitoring of compliance with environmental and sustainability regulations create a basis for sustainable business. I will show how companies can establish appropriate structures, including policies, processes, training and awareness-raising measures. An effective monitoring mechanism with regular audits and assessments of environmental, social and governance activities is essential.
Through increased collaboration and a corporate culture that is committed to environmental, social and governance issues, satisfactory reporting results can be achieved and corporate sustainability can be improved in innovative ways."
Further information on this exciting event can be found here:
EUDR introductory seminar - online seminar
?? Free seminar on the European regulation on the deforestation-free supply chain from 2024 ??
We are pleased to invite you to our free WIACON seminar on the European Deforestation-Free Supply Chain Regulation. This regulation affects critical commodities and products, including cattle, cocoa, coffee, oil palm, rubber, soy and timber. It is vital that companies are aware of the implications and understand their due diligence obligations. During the seminar, we will go into detail about how these commodities are affected and the steps companies can take to meet the requirements of the regulation. The European regulation on deforestation-free supply chains is not only a legal obligation, but also an important step towards sustainable business practices.
When: on 06.03.2024 from 12:00h -12:30h
?? Online via Teams - only in german
Registration: [email protected]
5. Insights from an Expert - CSDDD
The Corporate Sustainability Due Diligence Directive (CSDDD) is a draft EU directive that would oblige companies to comply with comprehensive due diligence obligations with regard to sustainability aspects.
The German Supply Chain Due Diligence Act (LkSG) has already held companies accountable for environmental pollution and human rights violations committed by their suppliers. Now the EU is planning its own, more far-reaching directive called CSDDD. This is intended to oblige companies with more than 500 employees and a global turnover of more than 150 million euros to comply with due diligence obligations in relation to sustainability issues. The obligations are also to be extended to companies with more than 250 employees and a turnover of more than 40 million euros if at least 20 million euros come from certain risk sectors. The CSDDD would affect a far greater number of companies than the LkSG and impose stricter requirements. Naming and shaming, high fines and compensation for damages are envisaged in order to enforce compliance with the obligations. However, critics fear excessive bureaucracy and competitive disadvantages for companies.
Directive agreement - December 2023
In December 2023, the Council and the European Parliament agreed on a directive that obliges large companies to review their impact on the environment and human rights. This applies not only to their own activities, but also to those of their subsidiaries and business partners. The directive also sets out sanctions, including fines, for companies that do not comply with it. Financial services are exempt for now, but a future review is possible. Compliance can also be a criterion for public contracts. Clear definitions and references to international conventions have been established. The agreement still needs to be formally approved.
Current status of the CSDDD
The planned EU directive on the monitoring of supply chains has been temporarily postponed as a sufficient majority could not be achieved in the Council at the current time. This outcome could be influenced by the refusal of Germany, in particular the ministries led by the FDP, if they do not give their consent. The Greens express concerns about possible political consequences for Germany and are in favor of approval.
Adoption of the CSDDD
It is unclear when a new date for the vote can be found. It is not foreseeable whether the CSDDD will be adopted before the European elections at the beginning of June.
6. Let’s get personal - WIACONs short interview
To gain an insight into how sustainability and the climate crisis affect WIACONers in their everyday lives, we asked the following question:
At which point did sustainability, ESG or even the climate crisis?or the absence of sustainability, ESG) play a role for you (privately or professionally) this month?
Leila Hosseingholizadeh: "Recently, I found myself shopping at a universally well-known clothing brand when suddenly, I recalled reading news about accusations of child labor associated with the brand. As a mother, I couldn't ignore this information, regardless of its severity or validity of the source, which I could not recall at the time.The issue has been lingering in my mind for several years because of its complexity. There is no one-size-fits-all solution for that. Across different countries and cultures, attitudes toward child labor vary, with some viewing it as a source of pride or a means to develop confidence in children. Even in more concerning cases, in some deprived countries where there is no social support for disadvantaged families, children working may be equal to avoiding severe hunger. However, despite knowing these challenges, I couldn't reconcile with supporting a supply chain that relies on children being deprived of their childhood.Ideally, we should strive to eliminate barriers and divisions in our efforts to support children. How can a child born here in Europe differ from a child in less developed areas in terms of innocence and basic rights? It may seem overly idealistic, but concepts like ESG could compel us toward this goal. This requires international collaboration, starting with providing all children with the basics like food, clothing, and education. Only then we can expect a future where work for children becomes a choice rather than a matter of survival, what the current legal minimum-age standards are not able to fulfill."
7. Did you know..?
More than 1 billion children worldwide are ensnared within the intricate network of global corporate supply chains, with repercussions reverberating through their families and communities. The year 2020 witnessed a staggering 160 million children grappling with the harsh realities of child labor, a dire situation exacerbated by the onset of the COVID-19 pandemic, which catapulted millions more into vulnerability. Adding to this plight, over 800 million mothers globally find themselves without adequate maternity leave or financial support, exacerbating the challenges faced by families striving to provide for their children.
Compounding these challenges, approximately 2 billion children reside in regions where air pollution levels exceed the safety thresholds prescribed by the World Health Organization (WHO), imperiling their health and well-being. Shockingly, in the world's most impoverished nations, over a fifth of children are embroiled in the vicious cycle of child labor, with more than a quarter of those aged between 5 and 17 subjected to hazardous work.
Child labor, whether in the form of toil undertaken by children below a certain age or perilous labor that impedes their physical, mental, social, or educational development, represents a grave violation of children's rights. In response, international conventions spearheaded by institutions such as the International Labour Organization (ILO) and the United Nations delineate and advocate for measures to combat this scourge, exerting influence on legislative action in signatory nations.
The overarching objective of these endeavors is to fortify the rights and protections afforded to children globally, cultivating environments where they can flourish in safety and security. Realizing this vision necessitates concerted efforts among governments, international bodies, businesses, and civil society. Through collaborative action, we can sustainably confront the blight of child labor, laying the groundwork for a brighter, more equitable future wherein all children are afforded the opportunity to thrive and reach their full potential.
Family-friendly principles enable an improved work and family environment: The four family-friendly principles are as follows:
Great to see such comprehensive coverage on #sustainability and #digitalization! Remember, as Steve Jobs once said - The only way to do great work is to love what you do. Your dedication to spreading awareness on these critical issues through your newsletter is inspiring! ???? Keep making a difference!