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

Biodiversity in focus in EOS’s Q3 Public Engagement Report

The Q3 Public Engagement Report from EOS at Federated Hermes focuses on three of its expanding engagement themes for 2020 – biodiversity and sustainable land use, fast fashion, and business purpose – all issues brought to the fore by the pandemic.

Fast reading

  • Deforestation raises risk of emerging infectious diseases jumping species barrier
  • Business purpose debate revitalised by Covid-19 pandemic
  • Innovative business models needed to cut fast fashion’s environmental cost

Companies have tended to take the immense value of nature for granted, but global ecosystems are now threatened at unprecedented levels. While a key 2020 summit on protecting biodiversity was derailed by the pandemic, the virus also brought our troubling relationship with other species to the fore.

The cover story in EOS’s Q3 Public Engagement Report highlights how deforestation and habitat loss bring animals into closer contact with people, increasing the risk of emerging infectious diseases jumping the species barrier. In her article, EOS engager Sonya Likhtman outlines the value of biodiversity, the business case for its protection, and how we expect companies to respond.

“Companies need to urgently acknowledge their impact and dependence on nature,” Likhtman says. “This means understanding the ways in which biodiversity and ecosystem services are relevant to the business model, be this through sourcing practices and supply chains, in the construction of new sites, or through the ways the company’s operations interact with surrounding ecosystems.”

Another topic pulled into sharper focus by the pandemic is that of business purpose. Some companies have attracted brickbats for issuing vague or meaningless statements of purpose, but the dilemmas faced by businesses trying to make it through the toughest of times have added a practical dimension to the debate.

In her article, EOS engager Amy Wilson highlights our work with the Enacting Purpose Initiative, which aims to provide practical guidance for boards on embedding purpose in organisations.

“Now is the time for companies to review their corporate purpose and its relevance for the business,” she says. “This should clearly articulate a positive contribution to society, identify the stakeholders most critical to sustainable returns, and how the company’s strategy and risk management processes can deliver value to all stakeholders.”

Finally, EOS engager Lisa Lange takes a look at the problems with the fast fashion business model, with more consumers turning to online retailers during lockdown. Lange explores the environmental cost of the take-make-dispose model, profiling our engagements on this topic with retailers and fashion brands.

“Innovative business models are needed that move away from a focus on the number of purchases as a growth model, to consider fashion as a service that fosters the reuse or recycling of garments,” Lange says. “Changing consumer preferences for sustainable clothing could be an opportunity for companies to build a strong relationship with their customers.”

To find out more, read the EOS Q3 Public Engagement Report. 

More Insights

Five Federated Hermes funds awarded Austrian EcoLabel
Five of the firm's funds have been awarded the Austrian Ecolabel
Spectrum Q2 2022: Investing into the aluminium paradox
In this latest edition of our quarterly Spectrum report, experts from Federated Hermes consider the question of aluminium. The lightweight metal will play a crucial role in the energy transition but will need to address its own carbon footprint first.
Climate Change High Yield Credit strategy, interim report 2022
In this inaugural report, we delve into what makes the Federated Hermes Climate Change High Yield Credit strategy unique. As well as introducing our process and team, the report provides an overview of our proprietary Climate Change Impact (CCI) score, complete with portfolio examples to illustrate the scoring system in practice.
Federated Hermes Stewardship Report 2021
At Federated Hermes we believe the investment industry can be a powerful force for good, building a fairer, more equitable world for all – and that active ownership and engagement is the best way to achieve this. In this, our second annual Stewardship Report, we provide an update on our efforts towards effective and outcomes-driven stewardship.
The chimps are coming
The public art exhibition Chimps are Family, unveiling on Endangered Species Day (Friday the 20th of May) at Tower Bridge, sets to create awareness around the plight of the endangered apes.
Market snapshot: Slowdown fears send equities spinning
Stagflation concerns continue to mount, with investors piling into cash positions as the global growth outlook plunges.