7 November 2023
The English version of the MCUR Digest (MGIMO Centre for Sustainable Development and ESG Transformation) is a regular information source accumulating the main Russian and world news in the sphere of sustainable development and ESG transformation, responsible finance and climate agenda. The English version is published monthly.
The twentieth issue is focused on the latest developments in the above-mentioned areas that were in the spotlight in September 2023. The originals of the news are available via active links in the text.
Climate Policy and Carbon Regulation
The climate agenda was a special topic at the Eastern Economic Forum held on September 10-13. It was discussed at the sessions titled “Climate Goals of Business: Limits of Opportunities”, “SCO and EAEU Climate Agenda: Moving Towards Common Goals” and “Global Challenges of the Green Agenda: a Test of Strength and a Catalyst for BRICS Countries Cooperation”. Andrey Slepnev, Minister of Trade of the Eurasian Economic Commission, spoke about the EAEU climate agenda and prospects for cooperation with Mongolia. Roscongress Foundation and SIBUR, a petrochemical company, agreed to transfer carbon units to the Eastern Economic Forum to fully repay the carbon footprint. Thus, the Eastern Economic Forum can become the largest carbon-neutral forum in Russia thanks to climate projects implemented by SIBUR. Kept, a consultancy, calculates the carbon footprint of the Forum. The transfer of carbon units from SIBUR will be effected via the blockchain-based Green Digital Platform. TÜV AUSTRIA Standards & Compliance, an audit company, will certify the calculations performed and confirm the repayment of the carbon footprint of the Eastern Economic Forum in accordance with the international standard ISO 14021:2016/Amd 1:2021.
Other news on the topic:
08.09.2023 Used Solar Panels Can Be Recycled into Batteries
09.09.2023 The German Bundestag Has Adopted a Law on Transition to Eco-Friendly Heating
11.09.2023 10 Russian Regions Have Received New Electric Buses
13.09.2023 The European Parliament Has Approved a Law on 70% of Eco-Friendly Aviation Fuel by 2050
13.09.2023 GAZ Group Will Help Transfer the Public Transport of the Sakhalin Region to Eco-Friendly Fuel
14.09.2023 Sber Has Proposed to Create a BRICS Carbon Balance Management Platform
15.09.2023 Biden’s Plan to Build 30 GW of Wind Power Facilities by 2030 Is Unfeasible
17.09.2023 Australia Has the Highest CO2 Emissions from Coal Power Per Capita in G20
17.09.2023 UK Has Licensed Oil Companies to Store Carbon in the North Sea
17.09.2023 In the Carbon-Neutral World, a Metallurgical Crisis Will Happen
21.09.2023 UK Softens Its Green Agenda Policy
28.09.2023 CO2 Emissions Quotas Have Been Set for Sakhalin Enterprises
Useful materials:
Monitoring of Climate Regulation. Summer 2023
Carbon Leakage: What Do Carbon Correction Mechanisms Lead To?
Sustainable finance
In its regular report titled “Review of ESG Banking in H1 2023: Sustainable Prospects”, Expert RA, a rating agency, assessed the state of ESG banking in Russia. According to the report, the volume of the ESG loans portfolio of Russian banks in the first half of 2023 increased by 42% compared to the same period last year and amounted to about 1.7 trillion rubles. Taking into account loans linked to ESG covenants, the total volume of the ESG portfolio amounted to about 2.7 trillion rubles. The main share (37%) in the ESG loans portfolio is made up by the real estate market, which mainly includes construction of green houses that meet criteria for energy efficiency, landscaping, the availability of sports playgrounds, etc.
In the survey, the banks determined the amount of discount (greenium) that they were ready to provide to the client when issuing an ESG loan. More than half of respondents (51%) consider a small discount to be optimal – less than 5 bps, and about 29% of respondents estimate discounts from 5 to 10 bps. Banks see the potential in ESG financing and are ready to engage in it, but for further increase of greenium they need support from the state, i.e. reduction of reserve ratios, allowances to reduce pressure on capital, etc.
At the end of September, DOM.RF and Gazprombank implemented the first deal on sustainable securitization of the mortgage portfolio. The issue of mortgage bonds in the amount of 29.8 billion rubles is secured by social and green housing loans issued by Gazprombank and the guarantee of DOM.RF. The issue is included in the Sustainable Development Sector of the Moscow Stock Exchange and became one of the top 5 largest ESG bond placements in the Russian market. It also complies with the Social Bond Principles (SBP) and the Green Bond Principles (GBP) of the International Capital Market Association and the Taxonomy of Green Projects. The issue was verified by ACRA rating agency.
Other news on the topic:
04.09.2023 Industrialized Countries Are Reluctant to Make Contributions to the Global Environmental Fund
05.09.2023 Partner Financing: Rules for Participation in the Experiment Have Been Established
06.09.2023 Center-Invest Bank Has Launched an Educational Program on ESG
08.09.2023 ESG Agenda in BRICS Countries Was Discussed at the Eastern Economic Forum
11.09.2023 Russia – ASEAN Cooperation in the Field of Sustainable Development
22.09.2023 5 Global Trends Affecting Sustainable Development Have Been Reviewed by Sber
25.09.2023 MTS Bank Has Received the Highest ESG Rating from the NCR and RBC
27.09.2023 AK&M Rating Agency Has Given the Highest ESG Reporting Rating to Sber
Corporate ESG Transformation
Russian rating agencies continue to assign ESG ratings to large companies:
- ACRA raised the ESG rating of Rosatom (ESG-2, ESG-B), assigned an ESG rating to Norilsk Nickel (ESG-2, ESG-B), First – Electric Power Industry Investment Fund, First – Halal Investment Fund, First – Global Internet Investment Fund.
- Expert RA assigned ESG ratings to Norilsk Nickel at the level of ESG-III(a), to X5 Retail Group N.V. at the level of ESG-II(a), and confirmed the rating of the Russian Environmental Operator at the level of ESG-II(c).
- The National Rating Agency confirmed the ESG rating of Smart Batteries at the level of A.esg.
- RAEX published an update of the ESG ranking for September 2023. There are 161 companies included in the ranking.
- RBC and the National Credit Ratings agency compiled the second ESG index, which included 114 companies. The results were presented at the 3rd RBC ESG Congress – (R)evolution.
- AK&M rating agency presented the sixth social efficiency rating of the largest Russian companies.
- The Managers Association published the 24th TOP 1000 Russian Managers Ranking, the award for Best Manager of Sustainable Development and Corporate Social Responsibility being a special nomination.
Corporate ESG transformation was also discussed at several sessions of the Eastern Economic Forum, such as “Sustainable Development of the State and Business. A Look into the Future” and “Protected Business as Key to Sustainable Development of the Economy”.
Other news on the topic:
06.09.2023 DOM.RF: Private Houses in Russia Will Be Marked as Green
27.09.2023 RAEX Has Assigned an “A” ESG Rating to a Russian Region for the First Time
27.09.2023 Education in the Field of Sustainable Development in Russia
20.09.2023 QIWI Sustainable Development Report for 2022
07.09.2023 RAEX Has Assessed the First Sustainable Development Report of Rosvodokanal
Useful materials:
Green Skills. What Formats of Sustainability Training Work Out Best for Employees?
Russian Companies’ Sustainable Development Reports: Research and Recommendations (Part 2)
Okkam Conference on Price and Value
Sustainable Development and ESG 22/23: Trends, Challenges and Value
Strategies for Sustainable Development of Russian Regions, a Webinar
Environmental Protection
On September 4, Saudi Arabia’s Crown Prince Mohammed bin Salman announced the launch of the Global Water Organization. The headquarters of the newly created organization will be located in Riyadh. The organization will support projects aimed at ensuring the long-term sustainability of water resources and ensuring universal access to water. At the end of August, Saudi Arabia also joined the BRICS group.
On September 16, the UN SDG Summit was convened in New York, during the General Assembly High-Level Week. Antonio Guterres, UN Secretary-General, presented the report titled “Progress towards the Sustainable Development Goals: towards a Rescue Plan for People and Planet”. Currently, just 15% of some 140 SDG targets are being implemented according to the original schedule. For almost 50% of the SDGs, there is a moderate or serious delay in their implementation, and about 30% of the SDGs were either not approached at all, or their target values fell even below the initial 2015 level.
The UN chief enumerated the main challenges which the international community is facing at the present moment, including the transition to renewable energy sources and ending the “war against the nature”. “We must put an end to the triple planetary crisis – to climate change, environmental pollution and loss of biodiversity”, Antonio Guterres said. It should be noted that the problem of protection and rational use of natural waters was not mentioned by Secretary General.
Alexey Overchuk, Chairman of the Eurasian Economic Commission Council, Russia’s Deputy Prime Minister, presented a joint statement of the EAEU member states at the UN SDG summit. The statement included:
- a summary of the report titled “Indicators of SDGs Implementation in the EAEU”;
- a list of indicators of achieving the SDGs, prioritized by the EAEU countries, a summary of the statistical report titled “Achieving Sustainable Development Goals in the Eurasian Economic Union”;
- information on the Bank of Climate Technologies and Digital Initiatives, which includes data related to carbon footprints, and a list of approved criteria for green projects in the EAEU member states.
Other news on the topic:
04.09.2023 An Old Landfill Is Being Recultivated near Melitopol
05.09.2023 A New Information Platform Has Revealed Large-Scale Sand Production in the World Ocean
05.09.2023 Invasive Species Cost the World Economy Billions of Dollars
07.09.2023 Medical Masks Production Caused the Release of More than 18 Million Tons of CO2 during the Pandemic
11.09.2023 Water Turbidity in the Delta of Lena is a Consequence of Global Warming
13.09.2023 A Nature Reserve Will Be Created in the Kherson Region
18.09.2023 The Most Forest Area in Russia Is in the Irkutsk Region, and the Least Forested Region is Kalmykia
21.09.2023 UN Global Treaty on Conservation of Biodiversity in the High Seas Has Been Signed
21.09.2023 Marking Bottle Caps Makes Them Less Recyclable
22.09.2023 Russian Environmental Operator Monitors Garbage Movement
25.09.2023 Artificial Lawns Pollute the Ocean with Microplastics
26.09.2023 Antarctica’s Shrinking Sea Ice Has Reached a Record Low
26.09.2023 Large Companies Will Engage in Biodiversity Conservation
28.10.2023 Swiss Glaciers Lost 10% of Their Ice over the Past 2 Years
28.09.2023 EU Bans Microplastics in Consumer Goods
28.09.2023 More Than 380 Illegal Landfills Have Been Revealed in Zaporozhye
Useful materials:
Authors: Andrey Avramenko, Sofia Denisova
Editors-in-chief: Capitolina Tourbina
Translator: Stanislav Shurygin
Designer: Maria Bakhireva
Disclaimer: The point of view of the MGIMO Centre for Sustainable Development and ESG Transformation may differ from the opinions of the authors of the news cited in the analytical publication. All materials are for reference only, and the MCUR is not responsible for their implementation in practice. The links to news sources used in the compilation of the MCUR Digest are indicated in the text and are active only in online format. The Digest does not use external copyrighted materials or reproduce them. If you have any questions, please contact: mcur@inno.mgimo.ru.
The MCUR Digest is being issued as part of the implementation of the strategic academic leadership program “Priority 2030”.
Department of International Complex Problems of Nature Management and Ecology
MGIMO Centre for Sustainable Development and ESG Transformation
