Search this website. You can use fund codes to locate specific funds

Authors

  • BP
    Bruce Duguid
    BP is one of the world’s six oil and gas ‘supermajors’, operating in 72 countries. It is a vertically integrated business operating across exploration and production; refining; distribution and marketing; petrochemicals; power generation; and trading. It is also active in the area of renewable energy in particular biofuels production, wind farms and a new solar joint venture, as well as early stage investments in advanced mobility; bio-products; energy storage; and carbon capture and storage.
  • United Utilities
    Bruce Duguid
    United Utilities is the second largest of 10 water and waste service companies in the UK, serving a population of approximately seven million people in the North West of England.
  • National Grid
    Bruce Duguid
    National Grid is one of the world’s largest publicly listed utilities. It focuses on the transmission and distribution of electricity and gas in the UK and the US. Background The company is committed to building a long-term sustainable business. In recognition of the risks to its business from climate change, it has set ambitious greenhouse gas reduction targets to reduce its emissions by 45% by 2020 and by 80% by 2050, compared to levels in 1990. However, two major storms in the US in October 2012 and February 2013, as well as a number of smaller storms, had a material effect on its results, reducing its operating profit by £136 million (€155 million/$183 million) in the reporting year 2012/13. In addition, between 2009/10 and 2011/12, its lost time injury frequency rate rose from 0.15 to 0.18, with three fatalities occurring in 2011/12.
  • GlaxoSmithKline
    Bruce Duguid
    GlaxoSmithKline (GSK) is a global healthcare business, with pharmaceutical, vaccines and consumer healthcare divisions. It employs over 100,000 employees and had a combined turnover of £27.9 billion (€31.8 billion/$37.7 billion) in 2016. Background In 2016, GSK was – for the fifth year running – the highest ranked pharmaceutical company in the well regarded Access to Medicine Index. It has been recognised for its commitment to research and development (R&D) for low- and middle-income countries and has a large number of R&D projects that target independently identified, high-priority product gaps. However, the company’s reputation for sustainable business practices has been significantly affected by two high profile scandals. In 2012, the company agreed a $3 billion settlement – the largest in the industry to date – with the US Department of Justice for its role in promoting drugs for unapproved purposes. In 2014, a Chinese court found GSK guilty of bribing non‐government personnel between 2007 and 2013 and the company was fined nearly $500 million, with suspended prison sentences for four executives. What we did In 2012, we spoke to the chair to understand the lessons learned by the company to avoid a repeat of the mis-selling scandal in the US. In 2013, shortly after we learned of the further scandal in China, we engaged with the company to gain assurances that it would take the issue seriously. We spoke to the chair and later the senior independent director to express concerns that in spite of a review of the remuneration of its sales force in the US, further issues had arisen in China.
  • September 13, 2017
    Stewardship
    Many Businesses Still Fail to Report Financial Value from Strong Environmental Performance, According to New Research from Accenture, CDP and Hermes Investment Management
    Bruce Duguid
    Despite almost $500bn in reported opportunities from climate change NEW YORK; Sept. 13, 2017 – Four in 10 telecommunications and consumer goods companies reporting to CDP fail to capture or report any financial value from strong environmental performance, according to new research released today by Accenture (NYSE: ACN), CDP and Hermes Investment Management. The largest emitters in the global economy, responsible for 50 percent of carbon emissions that was reported to CDP, account for a cumulative $447bn opportunity from climate change. Yet 42 percent of these companies have not yet quantified the potential value. “We see this as a huge missed opportunity for companies. Reporting on financial value through environmental performance allows businesses to build investor trust, provide meaningful transparency and help ensure long-term profitability,” said Justin Keeble, Managing Director, Accenture Strategy. “Through this partnership with CDP and Hermes, we’re bringing Accenture Strategy’s industry-leading insights to help companies focus on sustainability as a means for value creation.”
  • June 9, 2017
    Stewardship
    Decarbonisation: investors’ crucial role in achieving a global win-win
    Bruce Duguid
    The US’s withdrawal from the Paris Agreement has once again brought climate change, and by implication its associated economic risks, to the fore. Investors, businesses and governments are no longer able to turn a blind eye to carbon risks in the pursuit of fast profits, but can a low-carbon solution that suits all parties be found? The risks posed by climate change are many. Besides the well-publicised environmental impact – rising sea levels, melting ice caps and the destruction of habitats – businesses will also feel the effects. For example, Russia’s estimated losses from a 2010 heat wave and drought stand at $15bn, mainly from the destruction of crops. This contributed to global price increases and export restrictions on wheat. Meanwhile, insured losses from a 2011 flood in Thailand were similarly valued at $15-20bn and the disrupted supply of hard disk drives, of which Thailand produces 40% of the global total, led to price increases worldwide for both the drives and the products dependent on them (PWC, 2013)[footnote]“Business-not-as-usual: Tackling the impact of climate change on supply chain risk,” by Richard Gledhill et al. Published by PwC in Resilience: A journal of strategy and risk in 2013. [/footnote]. Clearly the effects of climate change on the global supply chain are already being felt, but can the problem be fixed?
  • April 11, 2017
    Stewardship
    Governance issues to be highlighted at Rio Tinto AGM
    Bruce Duguid
    • Hermes intends to vote against Chairman due to lack of diversity progress • Joins investor group in calling for further disclosure on climate risks Ahead of the Rio Tinto AGM tomorrow, Bruce Duguid, Stewardship Director within the Hermes EOS team at Hermes Investment Management, highlights two areas of focus in our engagement with the company. Environmental risk reporting The 2017 AGM season marks the first year of new climate change risk reporting requirements for mining companies Anglo American, Glencore and Rio Tinto. This follows the passing of resolutions last year, with the support of more than 95% of shareholders, requesting further disclosure of carbon-risk reporting and the company’s actions to manage them.
  • Shell
    Bruce Duguid
    Shell is one of the largest oil and gas companies in the world, with upstream and downstream operations in over 70 countries. We have engaged with the company since 2003 on a broad range of issues, including corporate governance, the management of environmental risks and, in particular, the avoidance and response to oil spills in remote locations, such as the Arctic, as well as the impact of its oil sands operations.
  • October 17, 2016
    Case Study
    Anglo American
    Bruce Duguid
    Anglo American is a large, diversified mining company listed on the London Stock Exchange with a secondary listing in Johannesburg. Founded in South Africa, it has been mining for around 100 years, becoming the largest producer of platinum, as well as a major producer of diamonds, copper, nickel, iron ore and metallurgical and thermal coal. As an energy-intensive company with an annual carbon footprint of approximately 20 million tonnes CO2 and with an exposure to coal mining, investors have for a number of years been concerned about the company’s exposure to the risks associated with climate change.
  • September 21, 2016
    Environment
    Climate paradoxes – Why engagement with companies is the answer to public policy
    Bruce Duguid
    Over the last couple of years, we have seen real progress in our engagement with companies on climate change. The shareholder resolutions put together by the Aiming for A investor coalition, which now cover seven companies in the extractives industry, are helping to define a new industry standard for reporting on climate change. Meanwhile, with the 2015 Paris Agreement, global leaders have finally got their act together on climate change policy.  The agreement sets out the ambition to limit the increase in global temperature as a result of climate change to at least 2°C and a framework for ratcheting up national policy over the coming years.
  • AstraZeneca
    Bruce Duguid
    Noting the company’s underperforming productivity in research and development and subsequently poor market rating at the time, our engagement with AstraZeneca was triggered by a share incentive scheme introduced in 2010. We voted against the scheme as its performance hurdles in dividend payments and dividend cover painted a bleak picture for the future of the business. Following this we met the company’s chair in 2011, which heightened our concerns on the company’s strategic direction and performance and left us questioning the quality of the board and the company’s leadership. AstraZeneca