WOKE WEDNESDAY: EU Regulates ESG Ratings, EU regulates ESG data, EU regulates ESG philosophy, plus US bans ESG and shareholders sucks at ESG

Live from the Vanguard Group’s 4th floor smokers’ room, it’s the ESG Industry’s ONLY weekly woke data podcast, featuring BS-man Matt Moscardi! In today’s Eggplant Sullen Gas called June 14, 2023: ultra nerdy ESG headlines, our alternative democracy, a bunch of dorky regulation news, and a word from our sponsor!

Our show today is being sponsored by ESGauge, your ESG data solutions provider 

Paul will be stopping by later to talk about increases in total compensation and perquisites.

DAMION1

Ultra Nerdy ESG Headlines

1. Woke Data

1. EU proposes to regulate ESG ratings providers

1. The European Union is to regulate agencies providing environmental, social and governance (ESG) ratings in an effort to improve standards in an industry that guides trillions of dollars of investments.

2. Investors are increasingly buying stocks and bonds according to how companies rank on various ESG metrics, and the ratings industry is growing fast as demand for investment products packaged and marketed as meeting ESG criteria balloons.

3. "ESG ratings agencies that score companies on governance factors are completely unregulated so it's very difficult to compare ratings by different agencies. We have no clarity on how these ratings are reached and there appears to be conflict of interests," Mairead McGuinness, European Commissioner for Financial Services, told reporters on Tuesday. "We want them (ratings) to be reliable and comparable."

4. MATT: THIS IS THE BOARD SABERMETRICS OPPORTUNITY OF A LIFETIME

2. Biogen refreshes board as chairman departs, adding a Langer while leaving 2 empty seats

1. Biogen has taken a step to “significantly refresh” its board of directors, departing chair Stelios Papadopoulos, Ph.D., said. But the reported romantic relationship between a new nominee and a departing member raises questions about the extent of this reshuffle.

2. In the meantime, current directors Alex Denner, Ph.D., 53, William Jones, 67, and Richard Mulligan, Ph.D., 68, will step down. The changes effectively left two empty seats on Biogen’s board.

3. Susan Langer, 32, has been named a new member of Biogen’s board of directors, the company said Monday.

1. But Langer, daughter of the legendary MIT professor and prolific biotech entrepreneur Bob Langer, is Alex Denner’s romantic partner, Endpoints News reported, citing people familiar with the situation.

2. A Biogen director recommended Langer for this role, the proxy filing shows. And according to Endpoints, that nominator was Denner. Denner has served on Biogen’s board since 2009 and is the chair of the company’s corporate governance committee. He is also chair of Sarissa Capital, which has waged recent proxy battles against Amarin and Alkermes.

3. Langer brings “fresh perspective to the board,” a Biogen spokesperson said in a statement to Fierce Pharma, adding that she “knows the company and the biotech ecosystem very well.”

4. Langer is currently president at Soufflé Therapeutics. She was the founding president of Kojin Therapeutics, which is delving into cell states to treat various diseases, and was the founding chief business officer of Paratus Sciences, which just raised a $100 million series A to borrow from bat biology to solve human diseases.

5. Her past experience also includes board membership at NextRNA Therapeutics, which Bob Langer co-founded, as well as partner stints at Old Silver VC and Guava Partners.

4. BS: chair Stelios Papadopoulos (16%); Alex Denner (10%); William Jones (6%); Richard Mulligan (11%)

1. 43% influence just walked out the door today!

2. Stakeholders Rule!/Alternative Democracy

1. Toyota Shareholders Re-Elect Akio Toyoda to Board, Rejecting Activist Push

1. Some U.S., European funds had sought to oust longtime leader

2. Toyota Motor shareholders re-elected longtime leader Akio Toyoda to the board Wednesday, rejecting a push by some investor groups in the U.S. and Europe over his stance on electric vehicles.

3. The company didn’t say what percentage of shareholders supported the renomination. Last year Toyoda earned 96% support. The company said the vote count would be released Thursday. 

4. Toyota shares were up more than 5% in Wednesday trading in Tokyo, to their highest level since early 2022. 

5. Shareholders also rejected a proposal from three European asset managers including Danish fund AkademikerPension to make Toyota management reveal more about the automaker’s lobbying in favor of vehicles that aren’t fully battery-powered.

2. Salesforce

1. 2023 votes against directors: 435M….2022: 227M

2. Independent chair 2023 168M... 2022: 256M

3. Here’s a new one:

1. National Center for Public Policy Research

2. forbidding Company directors from simultaneously sitting on the boards of directors of other companies

3. “Salesforce isn’t alone in this regard – nearly all large corporations are guilty of contributing to the corporate incest problem that’s plaguing the management of American business.”

4. “While this corporate practice may seem innocently cooperative to some, it creates a situation in which board members across corporations and non-profits are interchangeable and thus have more allegiance to each other than they do to the companies they are supposed to serve. In other words, the sharing and swapping of board members between corporations has given rise to an elitist managerial class that has sway over most large companies at the same time.”

5. 0.45% YES

3. Support for ESG Shareholder Proposals Plummets Amid GOP Backlash

1. Overall votes for environmental, social and governance resolutions dropped by about a third from last year’s levels.

2. Investor support for environmental and social shareholder proposals slumped to the lowest in six years amid the Republican backlash against sustainable investing.

3. Average backing for resolutions focused on climate change, workers’ rights, diversity and corporate governance declined this year to about 22% at annual shareholder meetings, down from a peak of 33% in 2021, according to a tally of votes compiled by the Sustainable Investments Institute through Thursday. Support hasn’t been this low since 2017.

4. The number of ESG proposals that went to a vote fell to 240 from a peak of 283 last year.

5. Anti-ESG

1. The point of such proposals isn’t necessarily to win, but to force companies to take a position on issues such as whether White people are being hurt by diversity efforts, said Scott Shepard, executive director of the Free Enterprise Project at the National Center for Public Policy Research, a conservative group that pushes for free-market solutions to policy issues.

2. “All we’re seeking in every effort we’re taking is to get companies back to neutral,’’ he said. “So they are admitting ESG is left wing and partisan by calling us anti-ESG, but we’ll take it because the admission itself is pretty huge. I think we can score that as a big win for our team.”

3. Stakeholders Rules!/Wars

1. A lawsuit brought by kids in Montana could determine if the state has a constitutional duty to protect its residents from climate change

1. A lawsuit brought against the state of Montana by a group of kids heads to trial on Monday.

2. Whether a constitutional right to a livable climate is protected by state law is at the center of the lawsuit.

3. The outcome has the potential to set an important precedent in the fight against climate change.

4. Whether a constitutional right to a healthy, livable climate is protected by state law is at the center of a lawsuit going to trial Monday in Montana, where 16 young plaintiffs and their attorneys hope to set an important legal precedent.

5. It's the first trial of its kind in the U.S., and legal scholars around the world are following its potential addition to the small number of rulings that have established a government duty to protect citizens from climate change.

6. The trial comes shortly after the state's Republican-dominated legislature passed measures favoring the fossil fuel industry by stifling local government efforts to encourage renewable energy while increasing the cost to challenge oil, gas, and coal projects in court.

2. Railroads Offer Paid Sick Leave, Better Work Conditions After Yearslong Efficiency Push

1. Union Pacific, CSX and Norfolk Southern agree to labor-friendly policies to ease staffing strains

2. Major U.S. freight railroads are adopting labor-friendly policies such as paid sick leave and predictable shifts to help address long-running staffing shortages that nearly boiled over into a nationwide strike last year. 

3. The railroads have reached agreements with unions representing employees such as track workers and machinists to pay for at least four days of sick leave a year. Three companies—Union Pacific, CSX, and Norfolk Southern —have also signed agreements with unions to offer train crews more predictable rest schedules. 

4. The changes are in addition to providing unionized workers a retroactive pay raise under a new national contract as well as scheduled increases this year and in 2024.

4. ,Pledge/Promise/Vow/2050 Tour

1. Uber Commits to Emissions-Free Uber Eats Deliveries by 2040
   
   

MATT1

Speaking of EU regulating stuff, more news: EU regulates everything!

• HUGE DROP THIS WEEK!  THE LONG AWAITED Corporate Sustainability Reporting Directive, or CSRD, WAS PUBLISHED BY THE EU COMMISSION!

• This is obviously not to be confused with European Sustainability Reporting Standards, or ESRS, or the prior Corporate Sustainability Due Diligence Directive, or CSDDD

• No, this was a 247 annex that outlines EVERY CONCEIVABLE ESG RATING DATA POINT in excruciating detail, accompanied by a 33 page dictionary for the terms and an 11 page discussion document!

• Most used phrase: “If the undertaking is…”

• This version identifies basically every indicator IN an ESG Rating, which they are also now proposing to regulate, so that everything can and will be micromanaged

Meanwhile, in the US…

• Ted Cruz put forth the “Stop ESG in the TSP” (Thrift Savings Plan) bill in the Senate, a companion bill to a House bill from May, and the cleverest of all anti-woke bills in history

• Part 5 U.S. Code § 8438 states:The Board, other Government agencies, the Executive Director, an employee, a Member, a former employee, and a former Member may not exercise voting rights associated with the ownership of securities by the Thrift Savings Fund.

• Cruz suggests amending it to add: “a qualified professional asset manager” to that section

• NO MORE VOTING FOR THRIFT PLAN!

• Bernie Sanders sent a letter to richer old white doppleganger Warren Buffett asking what insurers are doing to stop underwriting oil and gas

• Could there be better content than a Buffett Sanders hearing?

• Is the good news that all the anti-woke ratings are now also illegal?