Exchange Traded Funds (ETFs) are booming, synthetic ETFs are re-surfacing and semi-transparent ETFs have recently emerged – but their structures hide entrenched deforestation risk from investors. Planet Tracker identifies the key decision makers for each instrument in the growing ETF universe and calls for specific actions from index providers, ETF sponsors and investors to eliminate hidden deforestation risk in their holdings or indices.
Danone S.A. (BN:FP) Climate Transition Analysis
This report from Planet Tracker finds that leading French multinational food and beverage manufacturer, Danone S.A., is on track for a 1.5° warming scenario – on the proviso that Scope 3 Upstream emissions are sufficiently reduced. Danone is performing well in terms of governance, with high incentives for management tied to Net Zero objectives, as well as supplier engagement. The company is less advanced on its customer engagement and association with groups with a negative position on climate.
Destroying Brazil's AirCon
This report (the successor to No Rain on the Plain (2021), look at the effects of deforestation on the Brazilian economy and society at large, with a focus on agriculture, energy, productivity, health and transport. Sovereign bond investors exposed to Brazilian bonds, and equity and credit investors and banks exposed to domestic Brazilian companies or companies linked to Brazil through their supply chains, not to mention all their stakeholders, will soon suffer the direct effects of Brazil’s climate becoming more hostile.
Nature Dependent Exporters
This report classifies world exports into those dependent on nature – both renewable and non-renewable and those which are not, divides countries into high, medium and low nature dependent exporters and examines countries with high dependency, by looking at common characteristics based measures such as credit ratings, GDP per capita, economic inequality, food security, soil erosion and climate resilience.
Nestlé S.A. (NESN:SW) Climate Transition Analysis
Nestlé, the largest company in the food and beverage industry, is not currently investing enough in its upstream supply chain activities to achieve Net-Zero by 2050. Despite providing a detailed disclosure of its main CO2e sources and a broad Net-Zero Roadmap, Nestlé would need to invest at least USD 3.2 billion in its upstream activities to align with 1.5°C by 2030 (compared to its current USD 1.3 billion upstream abatement plan).
12 soy traders that control 89% of soy exports from the Paraguayan and Argentinian Gran Chaco, who are failing to prevent soy-driven deforestation in the region. The current level of deforestation is creating significant risk for these traders and other companies in the supply chain due to the associated CO2 emissions.
No Rain on the Plain
Deforestation is driving a negative feedback loop in Brazil, which is increasing risks for investors in Brazil’s sovereign bonds, as well as for equity and debt investors supporting companies across Brazil’s economy.
Online Retail Investors: Can't see the wood for the trees!
This report from financial think tank Planet Tracker reveals the challenges that retail investors face in identifying sustainable/ESG investment products across a portfolio of investment websites and portals.
Cattle are More than just Beef
Despite accounting for less than 9% of global agriculture’s market value in 2016 – compared to 22% for the meat industry, dairy is an important sector in both developed and emerging markets’ economies. 2016 estimates from the FAO suggest that a quarter of all farms worldwide keep at least one milking animal, which might include cows, goats, buffalo and/or sheep with dairy-related employment from farm to fork in the hundreds of millions.
From Drought to Fires to Downgrade Risk
New South Wales Faces Long-Term Credit Risks as Natural Infrastructure is Threatened
Financial Accounting in the Agriculture Sector
From Natural Capital to Accounting to Valuation – Commentary on IAS 41: Agriculture.
Scope for Improvement: Accounting for food loss and waste in Scope 3 reporting
Reported Scope 3 emissions by 12 publicly listed European food retailers account for 44% of total emissions in the European food retail sector in 2018.
Building Back Better: a Marshall Plan for Natural Capital: Reversing the decline in Sub-Saharan African GDP in Nature-Based Tourism Sector from COVID-19
Today, a global plan to support Sub-Saharan African (SSA) economies to increase social, economic and environmental resilience is needed, in light of the systemic shocks that we already know await us through climate impacts and now COVID-19 and its detrimental impacts on conservation funding.
Growing for Profit
Planet Tracker’s benchmark analysis of 37 funds in the food and agriculture sectors demonstrates that asset managers need to understand that, for their food and agriculture equity funds to be successful, they must measure, manage and monitor the natural capital risks in their investments by aligning these with sustainable food and agriculture systems to improve investment performance.