Sustainability News Roundup

The TakeAway: Sustainable finance, ForeclosureGate, and new leadership for Society of Corporate Secretaries offer challenges and hope.

Ceres report on water shortage | The impact of water problems on the municipal bond market may seem boring, but tell that to residents of Phoenix, Los Angeles, and Atlanta, whose water systems face the greatest risks in the years ahead.  A new report by Ceres and Water Asset Management (an investor in water-related businesses), The Ripple Effect: Water Risk in the Municipal Bond Market, shows how credit rating agencies fail to incorporate public utility systems’ vulnerability to water availability into credit risk scores.  This leaves investors exposed and makes it harder for water and electric utilities to raise money to cope with supply problems.  Follow @CeresNews on Twitter for updates.

“ForeclosureGate” and “Robo-Signers” | The foreclosure mess just keeps on growing, causing a cascade of responses:

• the SEC, the FBI, and all 50 state attorneys general are investigating wrongdoing;

• Capitol Hill lawmakers are considering hearings;

• the Obama Administration is pondering action;

• state judges are becoming more diligent; and

• evicted homeowners are lawyering up.

Oh, and the Federal Reserve system seems to have lost its appetite for shoring up failing banks.  The crisis even has its own lingo: “Foreclosure-gate” and “robo-signers”, or those who processed large numbers of foreclosure affidavits.  Alan Petrillo of MSCI ESG Research asks if foreclosure problems might have been diminished with better monitoring of environmental, social, and governance (ESG) risks.  Interfaith Center on Corporate Responsibility (ICCR) Executive Director Laura Berry reminds us that shareholder activists filed resolutions on subprime mortgages and “predatory lending” as early as 1993.  On October 27^th, MSCI hosts a free Webinar on sustainable finance; you can keep track of breaking developments on Twitter at #Foreclosuregate

Big Money and politics, proxy reform | Large donations continue to flood into the coffers of the US Chamber of Commerce, the New York Times reports today, with much of this directed to thwarting financial reform as well as aggressively supporting Republican candidates.  A Center for Responsive Politics analysis reveals that the Chamber spent $81.3 million on lobbying this year. OpenSecrets.org described the influence of the Koch brothers on federal candidates and committees, and continues to integrate information from newly filed lobbying reports into its lobbying database.  Meanwhile, the Washington Post and Wall Street Journal report on continued businesses opposition to proxy reforms  and attacks on proxy advisory firms in their comment letters to the SEC on proposed “proxy plumbing” rules.  (The Chamber, along with the Business Roundtable, is an outspoken critic of proxy reform.)  You can review comments from all sides on the SEC’s platform.

New Corporate Secretaries Leader Rooted in Social Responsibility | The Society of Corporate Secretaries & Governance Professionals recently appointed Ken Bertsch as President and CEO, a cause for celebration amongst ESG fans.  Bertsch is no stranger to corporate governance, having worked in the area for decades, most recently as Executive Director of Corporate Governance at Morgan Stanley Investment Management after working at Moody’s, TIAA-CREF, and the Investor Responsibility Research Center (IRRC).  Given the pivotal – and increasing – role corporate secretaries play in communicating with CEOs and boards, Bertsch’s a perfect choice, and his thought leadership a welcome sign that opportunities for blending sustainability with fiduciary stewardship lie ahead.  He assumes his new role December 6^th.