Call to Action on ESG Disclosure in Emerging Markets
3/8/2010
The Emerging Markets Disclosure Project (EMDP), an international initiative to improve corporate environmental, social and governance (ESG or sustainability) reporting in emerging markets, issued a renewed call to investors to sign onto its Investor Statement on Sustainability Reporting in Emerging Markets. Signatories to the statement affirm that the next generation of leading companies will distinguish themselves through their commitment to sustainability through robust ESG reporting and will be correspondingly rewarded by the market.
In fact, the EMDP’s most recent baseline study underscores the need for improved reporting in emerging markets.1 It found that only 14 of the 100 largest emerging market companies analyzed declared reporting in accordance with the Global Reporting Initiative’s guidelines, the most widely used sustainability reporting standard worldwide. In addition, only 30 percent of the companies offered any climate-related information.
“Disclosing environmental and social performance data is critical to investors for evaluating a company’s financial health and risk management, as this information augments financial analysis by indicating material risks and potential liabilities that might be overlooked by general accounting standards,” said Calvert Asset Management Company, Inc., Senior Sustainability Analyst andManager Mike Lombardo, who also is co-chair of the EMDP and lead of the EMDP South Africa country team. “Furthermore, ESG issues management can be used as a proxy for strong corporate governance and serve as an indicator of a company’s overall management quality, competitive positioning in face of mounting sustainability challenges, and overall growth potential,” he added.
In June 2008, the EMDP’s coordinators called on investors to join them in signing onto the investor statement, and 29 global institutional investors with close to $1 trillion in assets under management heeded that call to encourage companies in emerging markets to provide better ESG information. More than 15 other firms affiliated with the socially responsible investment movement, including investment advisors and research providers, also signed the statement in support of the initiative.
Further information on the EMDP can be found at:
http://socialinvest.org/projects/iwg/emdp.cfm
A copy of the investor statement can be found at:
http://www.socialinvest.org/projects/iwg/documents/EMDPInvestorStatement2010.pdf
About the EMDP
The Emerging Markets Disclosure Project (EMDP) is an international initiative to improve corporate environmental, social and governance (ESG or sustainability) reporting in emerging markets. The EMDP is under the leadership of a steering committee comprised of representatives from Boston Common Asset Management, Calvert Investments and the Social Investment Forum (SIF) and SIF’s International Working Group, with technical advisory support from the United Nations Principles for Responsible Investment (UNPRI). SIF is also the secretariat for the EMDP.
About Calvert Investments
A leader in Sustainable and Responsible Investments (SRI), Calvert offers investors among the widest choice of SRI strategies of any investment management company in the United States.
1 Emerging Markets Disclosure Project. (December 2009). Corporate Sustainability Disclosure in Emerging Markets. Retrieved Feb. 16, 2010.
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