"Baby steps are equivalent to nothing in this day and age."
This is what Mindy Lubber told ESG Insider, an S&P Global podcast about the environmental, social and governance issues shaping company strategies and investor decisions. Lubber is CEO of sustainability nonprofit Ceres, and she was talking about how slowly many companies are reacting to climate change and disclosing their environmental risks.
In this first episode of 2020, ESG Insider talked to Lubber and other key stakeholders across the ESG world about the issues they are focused on in the new decade. The sluggish response to rapidly worsening climate risks was a recurring theme.
CalSTRS Chief Investment Officer Christopher Ailman
"Given the immediacy of climate change, I am constantly surprised at the slow reaction of the markets of institutional investors," Christopher Ailman, chief investment officer of the California State Teachers' Retirement System, tells ESG Insider in the episode. CalSTRS is the 2nd-largest U.S. pension fund with a $248 billion investment portfolio.
Even companies that recognize the threat of climate change struggle with how to measure and disclose it. The lack of relevant, quality and comparable ESG data was another recurring theme among attendees of Sustainable Finance Week, a series of events in New York City where policymakers, asset owners and managers and corporations from around the globe convened in December 2019.
Ceres CEO Mindy Lubber
The lack of standards continues to create survey fatigue. Corporations are devoting a lot of time and money to filling out surveys from all different stakeholders about their ESG data — a common refrain at sustainability conferences.
There is a potential upside to survey fatigue, however, as we hear from the head of U.S. stewardship and sustainable investing for Legal & General Investment Management America Inc. in the episode.
In the meantime, groups like the Sustainability Accounting Standards Board are working to create consistency in the way companies disclose material ESG factors. In this episode, Jeff Hales, chair of SASB's Standards Board, told ESG Insider about the group's focus in 2020.