Monthly Archives: January 2015

January Edition of the Cornerstone JSFB Themed “Transparency”

In this month’s “Cornerstone Journal of Sustainable Finance and Banking” (JSFB) we focus on “Transparency.” We begin by examining Transparency as it relates to the banking sector with articles on physical commodity markets, the notion of “legitimacy” in banking and ultimately, a framework for a new industry ‘scorecard’ . . .

A Fresh Spotlight on Responsible Investment Practices

It is generally accepted that the finance industry has been lagging behind other industries in terms of adopting sustainability practices. This is particularly true when it comes to product development, one of the most material sustainability issues. Could greater transparency provide an effective mechanism to spur the industry into action?

Transparency

From banking to commodities, social factors, technology, manufacturing and supply chain management, this month’s JSFB focuses on “Transparency” and realizing fresh opportunities at scale.

Bringing Transparency to Social Impact Networks at Scale

Transparency, the theme of this journal’s issue, is at the core of sustainable finance. But why does the concept of transparency in philanthropy matter? Why should we care, for example, about articulating the assumptions that go into making grants, sharing publicly the processes that determine the beneficiaries and the amount they receive?

The Prince’s Accounting for Sustainability Project (A4S) Summit

As 2014 came to a close, HRH the Prince of Wales hosted the 10th anniversary Accounting for Sustainability Project (A4S) Summit and rightly stressed that “We need 21st century tools for 21st century problems…and time is not on our side.”  That does indeed capture the sense of urgency and purpose shared by the attendees of… Read more »

Transparency in Banking – Delivering a Sustainable Banking Scorecard

A sustainable real economy meeting the long-term needs of society requires a sustainable financial system. Stakeholders in the financial system should be able to transparently assess the extent to which a bank has a sustainability focused business model as well as the impact of this focus on the bank’s financial returns and its risk profile….

Russia’s Shift Toward the East

Vladimir Putin has been consecrated as the “No 1 enemy” of the year in 2014 by Western countries. Initially favored among American officials during his first two terms (2000-2008) for his economic reforms and solidarity in the war on terror, Putin is now depicted by Western media as the dominant threat against Western interests and the advancement of liberal values abroad….

Market Summary

As we look back at 2014, an environment categorized by slow economic growth, low interest rates and minimal inflation rewarded investors that followed a long-term strategy and took prudent risk. Looking ahead, many investors expect a continuation of the post-crisis bull market, which is now the second-longest annual winning streak on record. While the global economic backdrop appears to be generally supportive of this view, there are several risks confronting investors…

Pirelli: A Story of ESG Integration & Performance

Transparency is the first step in any sustainability strategy. In fact, several of the sustainability ratings agencies grade companies specifically on their disclosure and transparency. Internally, being transparent about environmental, social and governance issues allows a company to diagnose weaknesses, set targets, and engage employees in a common effort to improve.

Corporate Social Strategies, Investment Decision Making and Income Inequality

In our recent report, “Income Inequality: Market Mechanism or Market Failure?” we argue that unequal incomes are a normal feature of a free market economy. It is the extent of this inequality, coupled with stagnating wages and persisting poverty, which led us to focus on this topic. Why We Chose to Write on Income Inequality… Read more »

Transparency and Physical Commodity Markets: It Doesn’t Need to be Complicated

If we provide a robust solution for the physicals trade, robust and meaningful data will follow.

To a physical commodities trader, Eddy Murphy’s down-and-out character in 1983’s film “Trading Places” became a futures trader, a speculator, and a paper trader. To him, I would be described as a cash trader, a physicals trader or spot trader (despite frequency or negotiating long-term, forward contracts), who focuses on the underlying market….

Historical Transparency: Learning from Heritage at Levi Strauss & Co.

As the Historian for Levi Strauss & Co., I have an unusual challenge — making the past relevant to a company developing innovative new products and building a promising future. How do I make 161 years of heritage connect to current initiatives? By creating inspiring experiences with authentic company artifacts layered with deep story telling……

New Ideas on Water from Lyonnaise des Eaux

As droughts and water shortages have plagued global communities, the main environmental concern in France is pollution and the scarcity of water resources, ranking just behind global warming related to greenhouse gas emissions. In fact, 87% of the French population are convinced that they have a role to play in water protection, and 58% of them think they are responsible for water pollution. Whereas the infrastructure to produce and distribute water, built in the nineteenth century in France, allowed easy access to water for all, the twenty first century is clearly marked by increasing environmental concerns.

“The Integrated Reporting Movement”

“The Integrated Reporting Movement — Meaning, Momentum, Motives and Materiality,” by Robert G. Eccles, Michael P. Krzus, Sydney Ribot) follows the publication in 2000 of the first book on this topic by Eccles and Krzus, “One Report: Integrated Reporting for a Sustainable Strategy.” In just four years, integrated reporting has been transformed from an idea to a growing best practice for companies all over the world.

China & Russia: Policies and Markets

Cornerstone Capital Group hosted a call on Jan. 12 with geopolitical expert, Lionel Vairon, CEO of CEC Consulting. Dr. Vairon spoke about implications for the global economy given closer ties between Russia and China – including likely developments in energy, politics and the financial sector. Click below to listen to the call.   Dr. Lionel… Read more »

Introducing the Global Equity Strategy Investment Clock

Developing a multi-class asset allocation model — that also incorporates Environmental, Social and Governance (ESG) factors — is a lofty undertaking. In this report, we take a first step by introducing our global equity strategy “investment clock”, which helps flesh out the equity outlook implied by our sector and regional recommendations….

“Legitimacy” in the Banking Sector

Earnings and valuation uncertainty – In a post Global Financial Crisis world, investors are questioning long-term earnings and valuation prospects for the banking sector. Tougher regulation, particularly on capital, liquidity and structure, are exerting pressure on the traditional banking business and clouding the outlook for investors….

Regional and Sector Strategy: January Update

This month we, upgrade Financials to Overweight from Neutral reflecting the combination of relatively attractive valuations and improving earnings momentum. In addition, Financials’ earnings estimate revisions are only modestly negative (i.e., downward revisions just outpace upward revisions), in sharp contrast to most other sectors where estimate revisions are strongly negative. Our regional strategy remains unchanged…..