“Exchanges maturing in ESG leadership as nine-in-ten embrace sustainability – new WFE survey out today” – World Federation of Exchanges – May 17, 2018

The World Federation of Exchanges (WFE) announced on May 17, 2018 the publication of “its fourth annual Environmental, Social and Governance (ESG) survey of members, which shows nearly 90% of member exchanges are embracing sustainability initiatives.

 Key highlights include:

  • Overall, 88% of member exchanges now embrace some form of ESG initiative, and 42% of exchanges have increased the number of initiatives (that took part in last year’s survey).
  • 70% of ESG disclosures for listed companies were driven by the exchange, rather than the market regulator, in each market.
  • Seven exchanges have adopted the Task Force on Climate-Related Financial Disclosures (TCFD) Recommendations, while a further 11 are planning to incorporate these recommendations soon.
  • Exchanges are leading by example with 57% incorporating ESG factors into their own reporting, up from 48% in 2016.
  • Investor demand for ESG disclosure has increased to 70% in 2017 from 64% last year, and 57% of exchanges believe there is demand for sustainability-related products.
  • 70% of exchanges that reported no investor demand are either from emerging or smaller exchanges within the EMEA region. And;
  • The number of exchanges offering green or climate bonds has increased to 14 from eight exchanges last year, while sustainability indices remain the most commonly offered product.

On the WFE internet site you may read the press release and download the full survey.

“How screening can help stem risk in emerging markets” – Financial Times – May 14, 2018

In an article published on May 14, 2018 the Financial Times posits that “screening can help stem risk in emerging markets.”  The byline reads further:  “Environmental, social and governance filters can lessen the dangers in volatile areas.”

According to the article, “(i)n 2004, the Johannesburg Stock Exchange was the first emerging market to introduce a sustainability index. This was followed by the Brazilian exchange in 2005, which later cited pressure from European investors as a factor in its positive take-up levels.

These exchanges help set the tone for corporate governance and reporting — which is improving. Of the 38 stock exchanges that produce guidance to listed companies on ESG reporting — which covers factors such as how companies are moving towards a sustainable business strategy — 22 are in emerging markets.”

Registered users may read the article on the Financial Times internet site.