Greenhouse gasses trap heat in the atmosphere, leading to a phenomenon known as the greenhouse effect. As a whole, the greenhouse effect is a positive process, as it warms the planet to our comfortable standard of temperature and maintains Earth as inhabitable. However, there is a significant issue in that human activity is artificially inflating the natural greenhouse effect, causing an increase in global warming that is altering the planet’s climate systems in countless ways. Many factors accelerate global warming as there are several greenhouse gasses, and each of them has a different warming potential, life in the atmosphere, and source(s).

The aim of this brief, as well as of other activities of the Emerging Markets Investors Alliance (EMIA), is to support asset managers in their engagement activities by providing practical information about best practices in environmental sustainability. Specifically, we want to focus on extractive industries.

This roundtable discussion focused on the corporate governance aspects of gender equity, such as labor force composition, professional opportunities, work environment and safety for women etc. It also covered the “outside the fence” social issues related to local communities and the impact companies have on gender issues in their areas of operation.

A thought leader and a practitioner discussed the importance of biodiversity for investors. 

Natural gas is on the rise globally and in Africa—the opposite of what’s needed to meet the Paris Agreement. The current natural gas infrastructure already supplies the volumes required globally, and any addition is at risk of becoming a stranded asset. Africa has vast renewable energy resources that can supply the continent’s growing energy demand. These resources could also support economic growth in the region.

Continuing our educational and advocacy efforts toward NDC implementation and financing, on June 29, EMIA’s Sovereign Decarbonization Program hosted the UNDP Climate Promise team to share their success stories in assisting countries taking ambitious actions to reduce their emissions, increase their resilience to climate impacts, and support sustainable development priorities. The presentation addressed how their agenda is developing in terms of supporting EM countries with green financing planning and how institutional investors’ input is relevant in this process. 

On June 14, the Debt & Fiscal Governance Program hosted Elena Mondo, Senior Technical Advisor, and David Robins, Program Officer, Open Budget Survey, at the International Budget Partnership, to discuss the results of the 2021 Open Budget Survey and Open Budget Index. EMIA uses the Open Budget Survey and Index in its sovereign advocacy campaigns when engaging emerging market sovereign governments on the quality of their fiscal and debt transparency and public financial management.

On June 9, EMIA’s ESG Initiative hosted Danilo Simonelli, Managing Director, Ontario Teachers’ Pension Plan to speak about how the asset allocator looks at carbon footprints across their EM Debt portfolios, their Net Zero pledge, and how they plan on achieving it.  Jens Nystedt, Senior Portfolio Manager, Emso, joined Danilo and explore the challenges from an asset managers' perspective, including the validity and consistency of data. 

World Benchmarking Alliance's Digital Inclusion Benchmark, presented at EMIA APAC Conference 2022.

The 2nd Annual APAC EM ESG Conference was held virtually on June 8 & 9 starting at 12 pm HKT. This conference covered the specific ESG challenges to EM APAC in the APAC timezone. AllianceBernstein hosted this event and MSCI was the lead sponsor. 

Day 2: Small group meetings with issuers and investors focused on ESG issues, fireside chats, and presentations.

The 2nd Annual APAC EM ESG Conference was held virtually on June 8 & 9 starting at 12 pm HKT. This conference covered the specific ESG challenges to EM APAC in the APAC timezone. AllianceBernstein hosted this event and MSCI was the lead sponsor. 

Day 1: Panels, presentations, and fireside chats featuring ESG policy experts, issuers, and investors on corporate and sovereign ESG themes critical to investment decision-making and best practice adoption.

On Thursday, May 26, EMIA’s Financials Program hosted Emma Thompson, Lead on the Forest 500 project of Global Canopy, one of the four founding members of TNFD. Global Canopy is a data-driven environmental not-for-profit innovating to increase the scope, quality, and accessibility of environmental data, clear metrics, and actionable insights to key audiences in the financial sector, business, government, and civil society. 

EMIA’s Carbon Transition Initiative conducted a webinar to discuss the role of the energy sector in carbon transition, focusing on climate change risks and new opportunities for the oil and gas industry as the transition to a net-zero world unfolds.

EMIA’s Agriculture Program hosted senior members of the Chain Reaction Research team to discuss the palm oil sector’s sustainability trends, achievements, and challenges in Southeast Asia, Africa, and Latin America.

The speakers were Matt Piotrowski, Senior Director of Policy and Research at Climate Advisers; Chris Wiggs, Programme Director at Aidenvironment; Sarah Drost, Consultant at Aidenvironment; Barbara Kuepper, Senior Researcher Sustainable Supply Chains at Profundo; and Gerard Rijk, Equity Analyst at Profundo.

EMIA’s Sovereign Decarbonization Program hosted Guly Sabahi, Senior Advisor, Climate Finance, and Amanda McKee, Deputy Director Knowledge and Learning, Head of CAEP for the NDC Partnership.

The presenters explained how, with the support of the NDC Partnership, a growing number of countries have enhanced their NDCs and are taking concrete steps to implement their NDCs, including by improving their investment planning and formulating their financing strategies. 

The Debt & Fiscal Governance Program hosted Ian Carruthers, Chair of the International Public Sector Accounting Standards Board (IPSASB), and Fiona Stewart, Global Lead, Insurance, and Pensions, of the World Bank. Ian and Fiona discussed the evolving framework for sovereign climate and nature reporting.

EMIA’s TMT Program hosted Lourdes Montenegro, Lead on the Digital Inclusion Benchmark, a global, company-level benchmark of the ICT industry,  developed by the World Benchmarking Alliance (WBA) and Christine Chow, Ph.D., Global Head of Stewardship and Board Member at HSBC Asset Management. Lourdes and Christine discussed the evolving digital risks for corporate entities as highlighted in developing the Digital Inclusion Benchmark and the recently issued white paper on the use of AI in the workplace and employment processes.

The Debt & Fiscal Governance Program hosted Erica Westenberg, the Governance Programs Director of the Natural Resource Governance Institute (NRGI). At this program, Erica discussed how NRGI strengthens global extractives governance standards, and how investors can use the 2021 Resource Governance Index (RGI) to promote sustainable, inclusive development in countries rich in oil, gas, and minerals.

The Resource Governance Index defines resource governance as the rules, disclosures, oversight procedures, and enabling environment. It is a data-driven tool that provides governments, civil society, and oversight actors with a framework for ensuring that extractive sectors are governed with transparency and accountability. The 2021 RGI showed that over the last five years, resource governance scores have improved in 19 out of 22 country assessments.

EMIA’s Extractive Industries Program hosted Dr. Ann Maest, Aqueous Geochemist with Buka Environmental to discuss “Best Practices on Water Management in the Mining Industry.”

In this webinar, we discussed the impacts, challenges, and opportunities related to water use in mining projects; how mine operators can protect current and future water resources and minimize water pollution; and ways to adopt the best water management approaches. As a best practice, we reviewed the water management requirements of the IRMA standard and its qualitative and quantitative metrics.