The REP Wrap: Unilever rethinks strategy, industrials scored on transition, deforestation database launched

The World Business Council for Sustainable Development is among those urging the UK’s Financial Reporting Council not to deviate from the ISSB standards when it integrates them in national disclosure rules. Feedback from the regulator’s call for evidence was published this week, and came mainly from the finance industry and membership bodies. The Quoted Companies Alliance asked the FRC to take the resource constraints of smaller firms into consideration. Shell said it was “not supportive” of disclosure rules that cross-referenced other standards and guidelines. “Our rationale is that many issues arise when cross-referenced materials are used but are not developed using the same conceptual framework, leading to confusing and sometimes conflicting requirements,” the oil giant said. 

Unilever has revised its sustainability strategy to focus on shorter-term objectives and fewer topics. According to Research Live, CEO Hein Schumacher said during a quarterly update that its approach to sustainability had left it “spread too thinly”, working on long-term commitments at the expense of “short-term impact”. It will now focus on climate, plastic, nature and livelihoods. “Everything we do in this area must have material impact for the benefit of Unilever, as well as for the environment and the societies we serve,” Schumacher said, adding that, while its brands would all help it achieve the four objectives, Unilever would not “force-fit purpose across our entire portfolio”. “For some brands, it simply won’t be relevant, and that’s OK.”

The Glasgow Financial Alliance for Net Zero has published a list of actions from companies that align with its expectations on climate transition plans. Cemex, Vodafone, Diageo, Vesta and Easyjet are among those to be namechecked in the new document, which identifies exactly where each entity has published the relevant information, so it can be viewed by others. The initiatives are not rated or approved by GFANZ, but many come from its members. 

More than 40% of companies in the industrials and materials space don’t report sufficient information to be assessed on their climate transition, according to the Transition Pathway Initiative. The non-profit body, set up by investors and academics to analyse the decarbonisation trajectories of portfolio companies, published its latest ‘scorecard’ this week, focused on diversified mining, steel, paper, aluminum and cement. It found that 42% of firms – mainly in the cement sector – either didn’t disclose their carbon performance at all, or didn’t provide adequate information to be assessed. The study found that 7% of companies in the space had been aligned with its 1.5°C benchmark over the short, medium and long term in both 2022 and 2023.

A group of non-profits has launched a database of what 2,000 major companies are doing to address their links to deforestation. Forest IQ is run by Global Canopy, the Stockholm Environment Institute and ZSL, and uses 2,400 indicators relating to issues like conservation and human rights. A group of 10 investors and banks, including BlackRock and HSBC, helped develop the platform. 

Companies in the climate tech space have had the best fundraising quarter for nearly two years, according to BloombergNEF. Relevant companies across the energy, transport, buildings, industry and agriculture sectors raised $16.6bn between them in the third quarter of 2023. Those working on decarbonising heavy industry saw the greatest increase in investment, at 84%.