Morningstar Sustainalytics

During the US proxy season, shareholders vote on ESG issues and proposals listed on corporate proxy statements. The voting outcomes provide crucial evidence to help understand the current ESG topics of focus among investors. Every year, Lindsey Stewart, CFA, Director of Stewardship Research and Policy, tracks and analyzes the volume and support for key shareholder resolutions, with a focus on the evolving views on material ESG issues. This latest report, ESG Shareholder Resolutions: The Big Three Still Hold the Key, sheds light on the voting trends observed among asset managers and showcases the voting records of the Big Three index firms. Download the report to learn: 🔎Which ESG-related disclosures remain center stage and why support for some environmental and social (E&S) resolutions have declined this year. 📈Asset manager voting trends and voting records for the Big Three index firms (BlackRock, State Street, and Vanguard). This is vital information for investors who want to ensure their asset manager’s voting patterns are consistent with the investor’s own environmental and social priorities. 🗓️The trends of key shareholder resolutions from 2020–2024. At a time when there are more poorly supported resolutions and anti-ESG resolutions especially, the analysis of key resolutions provides a unique focus on important trends not surfaced by other commentators. Read the report here - https://bit.ly/3BkVvv6 #proxyvoting #proxyseason #agms #ESG #stewardship

During #ClimateWeekNYC, Morningstar Sustainalytics hosted the session called "Financing the Transition". Panelists representing asset owners, global investment managers, private capital GPs and banks all shared their perspectives on what's needed to finance the transition and what it will take to overcome key barriers to scaling up investments in companies, technologies and projects that significantly reduce carbon emissions. Some key takeaways from the spirited session include: 🚗The focus on reducing current portfolio emissions can sometimes hinder progress. It's time to shift towards financing the transition and enabling real-world decarbonization. Innovative financing tools, such as transition bonds, and unlabeled debt with transition plan disclosure could support decarbonization efforts for emission-intensive sectors and help to accelerate the transition. 💡Transition plans are coming under increased scrutiny. Asset owners, managers, and banks are evaluating the credibility of issuers' plans, looking for effective climate governance and capex allocation. More asset owners are also ensuring their managers are holistically assessing transition risk and undertaking credibility assessments of stated corporate climate ambitions. 🎯The drivers for fiduciaries to invest in transition strategies are multifaceted. Strong contractual income, attractive return potential, and effective risk management are paramount, but the narrative that investors can share regarding the real-world impact of their transition strategies is becoming increasingly important. 📊Finally, common metrics for evaluating transition plans and company climate action are needed. Engagement with issuers and requiring more relevant disclosures on climate risk management is also a key component of a successful transition investment strategy. Thank you to our panelist, Vanessa De La Ossa, Nazmeera Moola, Corinne Still, and Tara Mei Smith and our moderator Anya Solovieva for sharing their perspectives. And many thanks to Akshat Rathi for delivering the keynote and to Ron Bundy for welcoming the audience with his opening remarks.

🌏The global economy is pushing planetary boundaries and the financial risks of biodiversity loss are real. Are you ready to act? Join experts from Morningstar Sustainalytics and leading institutional investors to uncover: - The connection between biodiversity, climate, and human rights - Risks and opportunities for investors - How stewardship can drive better outcomes Register today to gain insights on this emerging financial imperative. Don’t miss out on this vital conversation! 👉https://bit.ly/3TIa1Ua 📆Date/Time: Oct 17, 9 am CEST / 4 pm JST 🎤Speakers: - Yu Rung (Ruby) Jeng, Senior Analyst, Stewardship, Morningstar Sustainalytics  - Dr. Dai Yamawaki, Senior ESG Investment Manager, Nomura Asset Management - Kaboo Leung, Active Ownership Specialist, NN Group - Lindsey Stewart, CFA, Director of Investment Stewardship Research (moderator) #biodiversity #climatechange #humanrights #stewardship

Last week, our Morningstar Sustainalytics team made the rounds at #ClimateWeekNYC, sharing valuable insights across various panels and events. A highlight was the #SDG Summit hosted by the UN Global Compact Network USA, focusing on aligning businesses with the Sustainable Development Goals. Simon MacMahon, Global Head of ESG Products, was part of the “Funding Tomorrow: The Role of Finance in Furthering the Global Sustainability Agenda” panel. He shared essential best practices for companies on sustainability reporting and SDGs, including: ✅Integrated reporting ✅Stakeholder engagement ✅Target setting

PFAS, a group of over 10,000 synthetic chemicals, are known for their non-stick, stain-repellent, and waterproof properties. However, they also accumulate in the human body, posing severe health risks like cancer, liver damage, and immune system issues. In their article, Susan Mair, ESG Research Senior Analyst, Healthcare & Chemicals, and Brent Anderson, ESG Research Lead Analyst, Construction & Industrials, discuss increasing US regulations as seen in the new EPA drinking water standards and the CERCLA designation of PFOA and PFOS as hazardous substances and the expanding potential liabilities across the supply chain. Key insights include: 🧪 PFAS litigation initially targeted manufacturers like 3M, Chemours, and DuPont for extensive pollution. Now, it includes companies across the entire PFAS supply chain, such as clothing and shoe manufacturers. 💵 Environmental remediation lawsuits, with varying monetary values, represent the bulk of penalties. ⚖️ The breadth of companies potentially subject to liabilities underscores the need for thorough due diligence and proactive risk management to navigate the evolving regulatory landscape. Read the full article here: https://bit.ly/3BqxROd #pfas #foreverchemicals #esg #drinkingwater

ESG regulations are evolving—are you prepared? Don’t miss our upcoming "Ask Me Anything" event tomorrow, October 3, 2024, featuring Sustainalytics experts. We’ll dive into the latest on greenwashing, explore future regulatory trends, and showcase a real-world example of leveraging data for compliance. After the panel, it’s your turn—ask us anything and get real-time answers from regulatory experts. 🎤 Speakers: Ruthann Bartello, CFA | Hortense Bioy, CFA | Lisette Brackel | Arthur Carabia 📅 Date: October 3, 2024 ⏰ Time: 9 am CST/4 pm CEST 🔗 Don't miss out! Register today: https://bit.ly/3Xpiahi #AMA #ESGregulation #sustainableinvesting #regulatoryreporting

Last week, Morningstar Sustainalytics attended the United Nations Summit of the Future. The outcome of the summit was the Pact for the Future, a “declaration pledging concrete action towards a safer, more peaceful, sustainable and inclusive world for tomorrow’s generation,” which included, among other commitments, a pledge to build stronger partnerships with civil society, the private sector, local and regional authorities and more. As the only private sector company invited to address the summit on opening day, we were able to express how investors can be a reliable partner in the implementation of the pact. 💻Click the link to watch Matthew Gray (马飞) remarks on behalf of Morningstar Sustainalytics: https://bit.ly/47Op3h2 #SDGs #summitofthefuture #sustainablefinance #ESG

In the new Voice of the Asset Owner survey results, we found that more than two thirds of the asset owners surveyed believe ESG has become “more” or “much more” material in the past five years. We believe this is driven by improved understanding of the linkage between ESG issues and company performance, increased action by regulators, and higher levels of ESG awareness among investors and issuers. Read the full quantitative analysis to learn more: https://bit.ly/4dsHKYV #MorningstarIndexes #ESG

In the latest review of US proxy voting trends, Lindsey Stewart, CFA examines the 2024 season, delving into the number of ESG resolutions proposed and the support behind them. https://bit.ly/4eEjAeV.. He notes that in addition to a decline in the number of environmental and socially focused resolutions, average support for these types of resolutions has also decreased. This trend is driven in part by several of the largest asset managers pulling back support and questioning the quality and necessity of many of the resolutions on the ballot. 👉Scroll below to see key insights and download our 2024 US proxy voting research “ESG Shareholder Resolutions: The Big Three Still Hold the Key.” https://bit.ly/4eEjAeV..