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【News】SynTao Green Finance ESG Newsletter-202305

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Author : SynTao Green Finance
Update time : 2023-06-16 15:49:10

The ESG Newsletter is prepared by SynTao Green Finance to provide readers with analysis and information on green finance, responsible investment and environmental, social and governance (ESG) issues. 

 

Key Focus · STGF Insights · Policy Update · Market Update

ESG Investment Instruments Update · ESG Controversies

 

Key Focus

 

Registration | 2023 China SIF Summer Summit is coming!

China SIF, 2023.6.12

The 2023 China SIF Summer Summit will be held in Beijing and live streamed online. We will explore engagement and stewardship topics, inviting investors and portfolio companies to discuss how to promote dialogue and mutual action on key ESG issues. We will also discuss the specific application of stewardship in promoting the low-carbon transition of companies, information disclosure and other topics.

Please scan the QR code to register:

Fill out the 15-year survey on responsible investment in China (institutional investor edition) and receive a free ESG online course

SynTao Green Finance, 2023.05.30

If you are an institutional investor, please tell us the ESG investment voice of your institution and fill in the name of your institution. You can add China_SIF to your WeChat and provide your institution's name to receive a free RMB99 voucher for the ESG online course "Coconut Chicken Class". (This questionnaire can also be completed anonymously)

Please scan the QR code to fill:

SynTao Green Finance attended the UNEP FI 2023 Asia-Pacific Roundtable Summit (Chinese Only)

SynTao Green Finance, 2023.05.29

The summit focused on topics such as financial support for sustainable transition in the Asia-Pacific region, the establishment of a sustainable financial regulatory system, and the Asia-Pacific version of the global biodiversity framework. In addition, with the upcoming launch of the PRB2030 framework, the conference also discussed topics such as the "impact and target setting" of responsible banking, and how to promote carbon emission reduction for clients.

SynTao Green Finance was invited to attend the Greater Bay Area ESG Talent Forum (Chinese Only)

SynTao Green Finance, 2023.05.06

This forum is an important event for the construction of ESG talents in the Guangdong-Hong Kong-Macao Greater Bay Area, and the participants discussed the relevant situation and next steps of ESG talent training in the region. It will play a positive role in increasing the development of green finance in the Greater Bay Area, enhancing the advantages of green finance reform and innovation, and promoting ESG in green and sustainable development.

SynTao Green Finance provides training onenvironmental information disclosure for financial institutions in Shenzhen (Chinese Only)

SynTao Green Finance, 2023.05.05

This training invited authoritative green finance experts to share the latest progress of sustainable information disclosure at home and abroad, introduce the environmental information disclosure requirements of financial institutions in Shenzhen, explain how  Shenzhen Green Finance Public Service Platform can support financial institutions in preparing environmental information disclosure reports, and invite representatives  from financial institutions and service providers to share their experiences.

 

STGF Insights

 

Keep on fighting, and Buffett rejected 6 ESG proposals (Chinese Only)

GUO Peiyuan, 2023.05.12

This year, there were 6 shareholder proposals at Buffett's shareholder meeting, more than in previous years. These proposals were all ESG-related, but they were all rejected. Three institutions have proposed ESG-related proposals for three consecutive years, due to the extraordinary significance and celebrity effect of Buffett's shareholder meeting.

Dialogue with Securities Times: How to build an ESG evaluation system with Chinese characteristics (Chinese Only)

SynTao Green Finance, 2023.05.04

China Capital Market Research Institute solicited the opinions of three experts, including Zhang Rui from SynTao Green Finance, on issues related to the ESG evaluation system. The three gave their suggestions on seven major ESG-related issues in China.

 

Policy Update

 

What are the signals of the first batch of national climate finance pilots? (Chinese Only)

China Nenergy News, 2023.05.04

As the green transition continues to accelerate, climate investment and financing are facing new development opportunities and challenges, and how to coordinate the respective advantages of policy tools and financial levers, and then promote the improvement and upgrading of climate investment and financing mechanisms, is the most direct way to drive the expansion and landing of funds.

Shanghai and Shenzhen Stock Exchanges are studying the Chinese version of the sustainability information disclosure guidelines for listed companies (Chinese Only)

China Securities Journal, 2023.05.06

Since 2023, the number of listed companies that have published sustainability reports has reached a new high, reaching nearly 1,700. To guide listed companies to practice the concept of sustainable development, Shanghai and Shenzhen Stock Exchanges are studying and formulating guidelines for the disclosure of sustainable development information of listed companies in combination with China's national conditions and the actual situation of listed companies.

Shenzhen Local Financial Supervision Bureau's website published the Shenzhen 2023 Environmental Information Disclosure Financial Institutions List (Chinese Only)

Securities Times,2023.05.19

This announcement is the first time that Shenzhen has announced a mandatory disclosure list. The list includes a total of 161 financial institutions such as banking, insurance, mutual fund and private equity. Relevant institutions should disclose the environmental information of the previous year by the relevant provisions of the Guidelines for Environmental Information Disclosure of Financial Institutions in Shenzhen before June 30, 2023.

Beijing promotes the construction of a global green finance and sustainable finance center(Chinese Only)

China Hightech, 2023.05.29

Xu Xinchao, deputy secretary-general of the Beijing Municipal Government, said that Beijing will take the policy advantages of building a comprehensive demonstration zone for expanding the opening up of the national service industry and the Beijing Pilot Free Trade Zone, increase the supply of green financial services and products, strengthen the service capacity of green credit, green bonds and green insurance, actively promote financial support for the construction of green cities, widely participate in international cooperation on green finance, and strive to build Beijing into an international green finance center.

 

Market Update

 

Hong Kong is becoming a hub for greentech and green finance

China Daily, 2023.05.05

Hong Kong is already home to a burgeoning list of greentech firms, and it issued its first tokenized government green bonds - the first of their kind in the world - in February. Moreover, Hong Kong was also Asia's top issuer of green and sustainable debts last year, raising $80 billion. Hong Kong Financial Secretary Paul Chan: "Our aspiration is much higher and bigger. We are determined to position ourselves as the center of green tech and green finance".

The world's largest sovereign fund strengthens ESG investment strategy, sovereign wealth fund and pension fund become the "vanguard"(Chinese Only)

CailianPress, 2023.05.18

Norway's National Sovereign Fund announced it would make greater use of shareholder proposals to require U.S. companies to disclose more ESG information. As of 2022, three-quarters of global SWFs have a formal policy on ESG investing, and 30% have set targets to reduce carbon emissions from their investments.

Climate Bonds Initiative releasesChina Sustainable Debt State of the Market Report 2022

Climate Bonds,2023.05.19

This is the seventh iteration of the China Sustainable Debt State of the Market Report. It describes the shape and size of the green, social, and sustainable (GSS) markets, plus sustainability-linked bonds (SLBs), and transition bonds, known as the GSS+ market. Data extends to the end of 2022.

Download the report at:

https://www.climatebonds.net/files/reports/cbi_china_sotm_22_en.pdf

 

ESG Investment Instruments Update

 

May ESG Funds Ranking

Note: This list screens the top 10 ESG funds by the percentage of peer group fund interval returns. The peer group funds include Equity Blend, Common Equity, International (QDII) Equity, Flexible Allocation, Enhanced Index, Passive Index, and Balanced Blend funds. 

Data source: Wind Data Terminal, compiled by SynTao Green Finance

New ESG Funds

Data source: Wind Data Terminal, compiled by SynTao Green Finance

 

ESG Indices

 

Based on a systematic assessment of the ESG performance of listed companies, SynTao Green Finance has developed a series of index strategies built around ESG factors. Within the CSI 300 and CSI 500, respectively, it has constructed a single-factor ESG meritocratic strategy index, preferentially selecting the top 20% of stocks; it has also constructed a weighting tilting strategy without changing the index components, tilting the weighting to companies with higher ESG score improvement companies and companies with higher ESG management scores.

As the end of May 2023, the excess returns of the CSI 300 ESG Single Factor Index, ESG Total Score Optimal Index, ESG Progress Optimal Index and ESG Management Optimal Index relative to the CSI 300 Index for the last six months were -0.41%、2.14% and 2.98% respectively; the CSI 500 ESG Single Factor Index, ESG Total Score Optimal Index, ESG Management Optimal Index and ESG Risk Selective Index over the CSE 500 Index for the last six months: 2.77%、2.93% and -0.30% respectively.

 

ESG Controversies

 

Environmental Controversies

· On May 30, Liaoning Chengda's (600739.SH) subsidiary is under investigation for illegally occupying agricultural land.

Social Controversies

· On May 3, an explosion and fire accident occurred in the hydrogen peroxide production area of Luxi Chemical (000830.SZ), resulting in 9 deaths, 1 injury, and 1 loss of contact.

· On May 9, Huayang (600348.SH) No.2 Mine was fined 1.5 million yuan for concealing a fire accident.

· On May 9, Minsheng Bank (600016.SH) is under self-discipline investigation for suspected underwriting business violations.

· On May 11, China Construction Bank (601939.SH) is under self-discipline investigation for suspected underwriting business violations.

· On May 15, an accident occurred in the construction project of China Construction Fifth Engineering Bureau (601668.SH), resulting in one person's death.

· On May 16, a cage fall accident occurred in the outsourcing company of Zijin Mining's subsidiary (601899.SH), resulting in six employees losing contact.

· On May 17, the outsourcing company of Zangge Mining's (000408.SZ) participating company experienced a cage fall accident, resulting in six employees losing contact.

· On May 24, Luxi Chemical (000830.SZ) has been listed for supervision due to an explosion and fire accident in the hydrogen peroxide production area, resulting in 10 deaths.

· On May 30, three subsidiaries of Tianan Coal Mining (601666.SH) were fined a total of 1.55 million yuan for violating safety regulations.

· On May 31, the issuance and trading of Guolian Securities (601456.SH) debt Financing instruments are suspected of violating the rules and are subject to self-discipline investigation.

· On May 31, the issuance and trading of Guohai Securities (000750.SZ) debt Financing instruments are suspected of violating the rules and are subject to self-discipline investigation.

Governance Controversies

· On May 2, Wang Ye, former Secretary of the Party Committee and President of China Construction Bank (601939.SH) Shenzhen Branch, has been prosecuted for suspected bribery.

· On May 4, Zhang Xigang, former member of the Party Committee and Vice President of Industrial and Commercial Bank of China (601398.SH) Tianjin Branch, is under investigation for suspected serious violations of discipline and law.

· On May 8, the battle for control of Ningbo Shanshan (600884.SH) has stirred up again, with Zhou Ting suing her stepson Zheng Ju.

· On May 8, Kingsoft Office (688111.SH) has been awarded a compensation of 10 million yuan for infringing the "Fuxin PDF" development package software.

· On May 8, Li Dajun, former Party Secretary and President of Bank (601328.SH) of Communications Yunnan Branch,  is under investigation for suspected serious violations of discipline and law.

· On May 9, Hualu Hengsheng (600426.SH) is sued by Sichuan Jinxiang for infringing on technical secrets, with a claim of 300 million yuan

· On May 9, ICBC (601398.SH) Bill Business Department Shanghai Branch was fined over 5.749 million yuan for unauthorized business activities.

· On May 9, Deppon's (603056.SH) annual report was criticized for accounting errors.

· On May 10, Liu Congsheng, a member of the Party Committee and Deputy General Manager of Pian Zihuang (600436.SH),  is under investigation for suspected serious violations of discipline and law.

· On May 10, a senior engineer from Sofia (002572.SZ) has been terminated by the company due to his request for suppliers to arrange prostitution activities.

· On May 11, Yang Guang, the Chief Expert of Agricultural Bank of China (601288.SH), was expelled from the Party and public office due to serious violations of discipline and law.

· On May 11, EAST (300376.SZ) and the controller of the largest shareholder are under investigation due to suspected violations of information disclosure.

· On May 12, Zhu Shu, a senior expert at Grand Joy (000031.SZ) , is under disciplinary review and supervisory investigation on suspicion of serious violations of discipline and law.

· On May 13, Xing Benxiu, former Vice Chairman of the Banking Management Advisory Committee of Minsheng Bank (600016.SH), is under investigation for suspected serious violations of discipline and law.

· On May 15, Zhuhai Guanyu (688772.SH) was found to have infringed on the patent rights of Ningde New Energy Company in the first instance, with a total compensation of 10 million yuan.

· On May 15, Lv Xiaodong, member of the Party Committee and Vice President of Agricultural Bank of China  (601288.SH) Zhejiang Branch, is under supervision and investigation for suspected serious violations of discipline and law.

· On May 16, Jizhong Energy (000937.SZ) and its controlling shareholders plan to be fined 500000 yuan for not disclosing deposits exceeding the agreed limit at the shareholders' meeting.

· On May 24, New Hualian, a shareholder of Changsha Bank (601577.SH), has been criticized in a notice for illegally reducing its holdings of company stocks.

· On May 31, Jia Jun, a member of the Party Committee, Deputy General Manager, and Trade Union Chairman of China Railway (601390.SH) Qinghai Tibet Group, is under investigation for suspected serious violations of discipline and law.
 

 

SynTao Green Finance (STGF) is one of the first Chinese organizations specialized in providing green finance and ESG responsible investment services, starting ESG data collection and research as early as in 2009. STGF ESG data and research on ESG key issues are widely employed to support investment decisions, risk management, policy making, and sustainable finance product innovation. "STGF STαR ESG Data Platform" and "STGF ESG Risk Radar System" cover all A-share market, and Hong Kong stocks in the stock connect schemes, amounting to 5,000 listed companies. In 2020, STGF launched "STGF PANDA Climate Data Platform", providing carbon emission data of Chinese entities based on GHG protocol. STGF ESG ratings (SynTaoGF-ESG) has been onboarding on Bloomberg Intelligence, making it the first Chinese ESG rating agency to have its data displayed on Bloomberg. 

STGF is the first signatory of Chinese service provider joining PRI, a member of the first Advisory Council of Green Bond Principles and Social Bond Principles of International Capital Market Association (ICMA), the founding member of China Green Finance Committee, the certified consulting agency for UK Green Investment Bank, the first China based Climate Bonds Standard (CBS) approved verifier, a member of the National Association of Financial Market Institutional Investors (NAFMII).

 

Disclaimer:The data used in this report, unless otherwise specified, is derived from the research institution's own research or collected through publicly available sources. The research institution is therefore not responsible for decisions made or actions taken based on the information in this report or for any losses arising from such decisions or actions.

This report does not provide legal, tax, accounting or specific investment recommendations. The report does not contain and does not constitute any offer or invitation to sell or buy.