The ESG Newsletter is prepared by SynTao Green Finance to provide readers with analysis and information on green finance, responsible investment and environmental, social and governance (ESG) issues.
Key Focus · STGF Insights · Policy Update · Market Update
ESG Investment Instruments Update · ESG Controversies
Key Focus
China Approves 18 Certification Agencies for Green Bond Issuance
Seneca ESG, 2022.09.28
On 21 September, the Green Bond Standard Committee announced the market-based assessment and evaluation of green bond evaluation and certification bodies. SynTao Green Finance has successfully registered as a green bond evaluation and certification body.
Seminar on Impact Investing and Social Bond was successfully Held online (Chinese Only)
SynTao Green Finance, 2022.09.23
On 8 September, the International Finance Corporation (IFC) of the World Bank Group and Haier Finance & Leasing co-hosted an online seminar on "Social Bond and Impact Investing". Dr Guo Peiyuan, Chairman of SynTao Green Finance, was invited to share his views.
SynTao Green Finance and Yenlex Law Firm Enter into a Strategic Partnership (Chinese Only)
SynTao Green Finance, 2022.09.05
On 1 September, SynTao Green Finance signed the strategic cooperation agreement with Yenlex Law Firm. The two parties will develop multi-faceted long-term cooperation in ESG compliance consultancy for private equity, including ESG due diligence, ESG compliance solutions, ESG investment management, rating and information services, compliance consulting and training.
SynTao Green Finance, 2022.09.02
On 29 August, the "ESG System Development and Research" project launch of the CAPID was held in Beijing. The Launch Ceremony was moderated by Li Xiaojun, Vice President of CAPID. Dr Guo Peiyuan, Chairman of SynTao Green Finance, and Ms Grace Guan, Executive Vice President of SynTao Green Finance, attended the Launch Ceremony and spoke about relevant ESG issues.
STGF Insights
Construction of a Green Finance Standard System in China (Chinese Only)
Guo Peiyuan, An Guojun, 2022.09.26
Green finance in China has been promoted by various sectors in recent years. The green finance system has been relatively well developed and structured, with China providing valuable strategic frameworks and policy guidelines for global green investment. This article explains how China has built a green finance standard system regarding top-level architecture, green finance product standards, local pilots and international cooperation.
TCFD Series: TCFD Initiation and Adoption (Chinese Only)
SynTao Green Finance, 2022.09.06
In December 2015, the G20 Financial Stability Board (FSB) led the Task Force on Climate-Related Financial Disclosures (TCFD), intending to develop and provide a globally agreed framework of recommendations on climate-related financial disclosures to help financial institutions such as investors, creditors and insurers to reasonably assess the climate-related risks and opportunities and make more informed financial decisions.
SynTao Green Finance, 2022.09.21
In developing the disclosure framework, the TCFD considered both the potential challenges faced by companies and the practical value of the information disclosed to the report users. The TCFD consulted widely with both companies and users and took into account existing systems for the disclosure of climate-related financial information. TCFD is described as a disclosure framework developed by and for market participants.
TCFD Series: Identification and Scenario Analysis of Climate Risk and Opportunities (Chinese Only)
SynTao Green Finance, 2022.09.26
Climate-related transition and physical risks can trigger a range of financial risks, such as credit risk, market risk, underwriting risk, operational risk and liquidity risk through the transmission of effects on microfinance and macroeconomics. Scenario analysis and stress testing with forward-looking features are essential in climate risk assessment and management.
Policy Update
ISO Green Finance International Standard Officially Launched
ISO, 2022.09.16
The International Organisation for Standardisation (ISO) has recently published "ISO 14100:2022 Guidance on environmental criteria for projects, assets and activities to support the development of green finance". This document establishes a framework and outlines a process to identify criteria for environmental impacts and performance to take into account when considering projects, assets and activities seeking finance.
This document also gives guidance on assessing the risks and opportunities that can arise in applying environmental criteria to projects, assets and activities.
It is applicable to parties seeking finance, providing finance or other interested parties.
Eight Beijing Departments Jointly Release 22 Initiatives to Help Build a Global Green Finance and Sustainable Financial Centre
Beijing Local Financial Supervision and Administration, 2022.09.02
On 28 August, the Municipal Bureau of Financial Supervision, the Department of Business Administration of the People's Bank of China, the Beijing Banking and Insurance Regulatory Bureau, the Beijing Securities Regulatory Bureau, the Municipal Development and Reform Commission, and the Municipal Bureau of Economy and Information Technology, the Municipal Bureau of Finance and the Municipal Bureau of Ecology and Environment jointly issued the "Action Plan for the Reform and Opening-up Development of Green Finance in the Two Districts". It aims to promote the reform and opening up of green finance sector in the two regions and accelerate the construction of a global financial centre for green finance and sustainable development that can provide research, decision-making, and market operation.
MAS and SGX Group Launch ESGenome Disclosure Portal to Streamline Sustainability Reporting and Enhance Investor Access to ESG Data
MAS, 2022.09.12
The Monetary Authority of Singapore (MAS) and Singapore Exchange (SGX Group) jointly launched ESGenome. ESGenome is a digital disclosure portal for companies to report Environmental, Social and Governance (ESG) data in a structured and efficient manner and for investors to access such data in a consistent and comparable format.
Market Update
Climate Action 100+ : Investor Guide for Engaging in Asia
Climate Action 100+, 2022.07.19
Climate Action 100+ has developed an updated version of the “Investor's Guide to Engagement in Asia” with the support of Chronos Sustainability. Investors can bridge the gap between companies' practices and the Benchmark. This guide hopes to support the ongoing dialogue between investors and Asian companies, and other key stakeholders.
Download the report in English at (please copy to open in your browser)：
https://www.climateaction100.org/wp-content/uploads/2022/07/Asia-Engagement-Guide-2022-English.pdf
China Banking Association Releases “China Banking Sector Social Responsibility Report 2021”
China Banking Association, 2022.09.15
Recently, the China Banking Association officially released the China Banking Industry Social Responsibility Report 2021. The report summarised the practical achievements and typical cases of China's banking financial institutions in serving national strategies, promoting shared prosperity, promoting inclusive finance, consolidating livelihood protection and empowering green development in the past year, and demonstrates the actions and effectiveness of China's banking industry in actively assuming social responsibility.
ESG Investment Instruments Update
September ESG Funds Ranking
Note: This list screens the top 10 ESG funds by the percentage of peer group fund interval returns. The peer group funds include Equity Blend, Common Equity, International (QDII) Equity, Flexible Allocation, Enhanced Index, Passive Index, and Balanced Blend funds.
Data source: Wind Data Terminal, compiled by SynTao Green Finance
New ESG Funds
Data source: Wind Data Terminal, compiled by SynTao Green Finance
ESG Controversies
Environmental Controversies
· On September 7, Yichun Kefeng New Materials Co., Ltd, a subsidiary of Gotion High-tech Co.,Ltd. (002074.SZ), was fined a total of CNY 1.15 million for two environmental violations.
Social Controversies
· On September 5, China Merchants Securities (600999.SH) was fined CNY 63 million for failing to exercise due diligence as an independent financial advisor.
· On September 7, the Jiaxing branch of CITIC Bank (601998.SH) was fined CNY 2.05 million for not having the "three checks" in place for loans.
· On September 8, Shanghai Pudong Development Bank(600000.SH) was fined CNY12.68 million for illegal handling of foreign exchange settlement and other businesses.
· On September 16, a fire broke out in the building of China Telecom (601728.SH) in Changsha and no casualties were found.
· On September 18, two people died in a poisoning accident at China Petroleum & Chemical Corporation (600028.SH) Qilu Branch, and two people were recommended to be held criminally responsible.
· On September 19, China Merchants Securities (600999.SH) received the SFC's "Administrative Penalty Decision Letter" and a fine of CNY 63 million was imposed.
· On September 20, MLS (002745.SZ) recalled some MUFON brand mirror moon downlights.
· On September 20, a subsidiary of MLS (002745.SZ) recalled some of its MUFON brand LED ceiling lights.
Governance Controversies
· On September 1, Dalian Branch of Industrial Bank (601166.SH) was fined CNY 2.4 million for failing to fulfill its customer identification obligations as required.
· On September 1, Wang Bin, former Party Secretary and Chairman of China Life (601628.SH) Insurance (Group) Company, was expelled from the Party and public office for serious disciplinary violations.
· On September 1, Foshan Aier Eye (300015.SZ) was fined more than CNY 700,000 for illegal use of medical insurance funds.
· On September 5, Ms. Zhang Li, the director secretary of Walvax Biotechnology (300142.SZ), was retained for investigation for personal reasons.
· On September 5, Minsheng Bank (600016.SH) Haikou Branch was fined CNY 2.27 million for violating regulations on payment and settlement and anti-money laundering management.
· On September 7, Beijing Enlight Media (300251.SZ) was notified of inaccurate performance forecasts by the Shenzhen Stock Exchange.
· On September 8, Zhongnan Construction (000961.SZ) was notified and criticised for the increase in the difference between the forecast and actual net profit and the change in the nature of profit and loss.
· On September 8, RiseSun Real Estate Development (002146.SZ) was notified of criticism by the Shenzhen Stock Exchange for the large difference between the forecast and the actual net profit and the change in the nature of profit and loss.
· On September 9, China Life (601628.SH) property insurance company business director Fei Jianfeng suspected of serious disciplinary violations of the law under review and investigation.
· On September 9, Construction Bank (601939.SH) Beijing Branch was fined CNY 4.873 million for violating anti-money laundering regulations.
· On September 9, Joinn Laboratories (China) (603127.SH) was notified by the SSE for criticism of its beneficial owner's violation of shareholding reduction.
· On September 13, Wang Bin, former Party Secretary and Chairman of China Life (601628.SH) Insurance (Group) Company, was arrested: suspected of taking bribes and concealing offshore deposits.
· On September 16, Zhang Long, former director of investment and finance of Construction Bank (601939.SH), was suspected of serious disciplinary violations and accepted a review and investigation.
· On September 17, Gao Youqing, former president of Jiangsu Agricultural Bank (601288.SH), was sentenced to 16.5 years in prison for taking bribes, misappropriating public funds and illegally granting loans.
· On September 17, Trina Solar (688599.SH) was sued by Total in a change of events: both the parent company and executives became defendants.
· On September 19, Han Fenglin, the former risk director of the Shenzhen branch of Construction Bank (601939.SH), was expelled from the party and public office.
· On September 19, the former chairman of Hengrui Medicine (600276.SH) was fined CNY500,000 for insider trading.
· On September 23, Suning Universal (000718.SZ) subsidiary received a decision on administrative tax penalties, with the amount of administrative penalties and the total amount of back taxes to be paid being CNY 14.65 million .
· On September 24, a number of insured disputes at S.F. Holding (002352.SZ) sparked hot debate.
SynTao Green Finance (STGF) is one of the first Chinese organizations specialized in providing green finance and ESG responsible investment services, starting ESG data collection and research as early as in 2009. STGF ESG data and research on ESG key issues are widely employed to support investment decisions, risk management, policy making, and sustainable finance product innovation. "STGF STαR ESG Data Platform" and "STGF ESG Risk Radar System" cover all A-share market, and Hong Kong stocks in the stock connect schemes, amounting to 5,000 listed companies. In 2020, STGF launched "STGF PANDA Climate Data Platform", providing carbon emission data of Chinese entities based on GHG protocol. STGF ESG ratings (SynTaoGF-ESG) has been onboarding on Bloomberg Intelligence, making it the first Chinese ESG rating agency to have its data displayed on Bloomberg.
STGF is the first signatory of Chinese service provider joining PRI, a member of the first Advisory Council of Green Bond Principles and Social Bond Principles of International Capital Market Association (ICMA), the founding member of China Green Finance Committee, the certified consulting agency for UK Green Investment Bank, the first China based Climate Bonds Standard (CBS) approved verifier, a member of the National Association of Financial Market Institutional Investors (NAFMII).
Disclaimer：The data used in this report, unless otherwise specified, is derived from the research institution's own research or collected through publicly available sources. The research institution is therefore not responsible for decisions made or actions taken based on the information in this report or for any losses arising from such decisions or actions.
This report does not provide legal, tax, accounting or specific investment recommendations. The report does not contain and does not constitute any offer or invitation to sell or buy.