The Sustainability Yearbook 2021
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The Sustainability Yearbook 2021 Tackling parity, plastics and petroleum - reflecting on values, anticipating risks and identifying opportunities The Sustainability Yearbook 2021 February 2021 S&P Global spglobal.com/yearbook 2 The Sustainability Yearbook 2021 2021 Annual Corporate Sustainability Assessment 61 7,032 Industries Companies assessed* *As of January 22nd, 2020 215,412 7,326,876 Documents uploaded Data points collected The Sustainability Yearbook 2021 3 The Sustainability Yearbook ISBN 978-3-9525385-0-0 (print) ISBN 978-3-9525385-1-7 (online) Publisher Evan Greenfield, [email protected] Editor Robert Dornau, +41 44 529 51 73 [email protected] Contributors Editorial Board Edoardo Gai Evan Greenfield Nathan Hunt Robert Manjit Jus Rosanna Dornau Brady Copy Editors Director, ESG Operations Corporate Rosanna Brady, Mariano De Lellis, Specialist, Engagement, Lyn Zurbrigg S&P Global S&P Global Production Manager David Sullivan, + 44 207 176 0268 Alexandra [email protected] Mihailescu Cichon Marie Production Office Executive Froehlicher S&P Global Switzerland SA Vice President, Zürich Branch Sales and Marketing, ESG Specialist, Josefstrasse 218 RepRisk S&P Global 8006 Zürich Switzerland Lotte Article Reprints & Permissions Knuckles John Griek S&P Global Switzerland SA Duncan Head of Corporate +41 33 529 51 70 Initiative Lead, Sustainability [email protected] No Plastics in Nature, Assessments, S&P Global WWF International S&P Global 55 Water Street New York, New York 10041. United States General Chuck President & CEO Kieran Jacoby Doug Peterson Dobson (US Army, Ret.), Global Head of ESG Research PhD, Executive ESG Specialist, Vice Chairman, Manjit Jus S&P Global Tilman & Company 4 The Sustainability Yearbook 2021 Contributors Robert Manjit Jan Anton Dornau Jus Lily van Zanten Shepherd Director, Global Head, Strategist, Corporate ESG Research Programme Manager, Sustainable Engagement, and Data, Ellen MacArthur Development Goals, S&P Global S&P Global Foundation Robeco Jacob Messina Nathan Lindsey Senior Sustainable Stovall White Investing Principal Analyst, Senior Editor, Strategist, S&P Global S&P Global Robeco Market Intelligence Market Intelligence Azadeh Isabelle Nematzadeh Stauffer Senior Data Senior Manager, Scientist, ESG Research, S&P Global S&P Global General Chuck Jacoby Douglas L. Leo (US Army, Ret.), Peterson Executive President Tilman Vice Chairman, and CEO, Founder and CEO, Tilman & Company S&P Global Tilman & Company The Sustainability Yearbook 2021 5 Foreword Dear Stakeholder, In a world of extreme uncertainty, people are searching for clarity. Clarity to make business and investment decisions. Clarity to move their organizations forward with confidence. Last year, more companies than ever took part in our Corporate Sustainability Assessment. A record amount of corporate ESG data derived from this preeminent evaluation offers shareholders, executives and anyone who wants independent insights, the transparency to make better-informed choices. This new level of disclosure is testimony to one of the silver linings of 2020. The convergence of the COVID-19 pandemic, increased consciousness of race, diversity and inclusion in our communities and the devastation created by extreme weather and climate change have cemented the theme of sustainability as the business community’s No. 1 priority. As we begin 2021, the commitment of the new U.S. administration to put climate policy at the forefront of its domestic and international agendas promises to reinforce and accelerate this trend, with implications for the growth in carbon markets and innovation in the broader energy transition. 6 The Sustainability Yearbook 2021 This Yearbook is once again filled with Looking ahead to the rest of 2021 and revealing data and stories. Articles beyond, I am as hopeful as ever about about rethinking how to assign value the positive contributions businesses across investments, companies will make to society. Increasing levels of and economies; plastics packaging; engagement in the CSA create the gender equality in the workforce; the essential intelligence to power the markets electrification of transportation; and of the future and to accelerate progress using ESG as a tool for effective risk in our world. management are worthy of your time. In a year when so many other things were competing for people’s attention, I want Sincerely, to express S&P Global’s gratitude to each of the companies that participated Douglas L. Peterson in the CSA in 2020. Contributing to the President and CEO CSA last year demonstrated a great deal S&P Global of commitment to transparency and to building more sustainable economies and communities during a difficult time. I also want to thank every one of our team members who are responsible for collecting and analyzing the CSA submissions. It’s been one year since we acquired the ESG ratings business from the asset manager Robeco. We’re proud of the team’s integration and we’re pleased at how essential the CSA has become to the ESG work we’re doing at our company. The Sustainability Yearbook 2021 7 Table of Contents 8 The Sustainability Yearbook 2021 Foreword 6 Rethinking the value of everything 10 Jacob Messina, Senior Sustainable Investing Strategist, Robeco Jan Anton van Zanten, Strategist for the Sustainable Development Goals, Robeco Identification and management of new risks - key gaps and recommendations 20 Isabelle Stauffer, Senior Manager ESG Research, S&P Global Gender equality in the workplace: women on the board 38 Marie Froehlicher, ESG Specialist, S&P Global Loote Knuckles Griek, Head of Corporate Sustainability Assessments, S&P Global Driving the energy transition: more than just downside demand 58 Kiernan Dobson, PhD, ESG Specialist, S&P Global Manjit Jus, Global Head of ESG Research and Data, S&P Global Packaging the future: a material matter 72 Rosanna Brady, ESG Operations Specialist, S&P Global Robert Dornau, Director Corporate Engagement, S&P Global Sustainability Leaders 2020 92 Industry Profiles: 61 Industries At A Glance Company Overview 164 The Sustainability Yearbook 2021 9 Rethinking the value of everything A hard look at how value is measured in investment portfolios, corporate performance and national economies 10 The Sustainability Yearbook 2021 The Sustainability Yearbook 2021 11 Current measures of value are too narrowly focused on measuring growth and progress in terms of goods and services consumed and produced. As a result, the value of easily monetized input, outputs, and capital assets is overestimated while the more diffuse but nevertheless material value that characterizes social and environmental assets is underestimated. Moreover, such rigid accounting frameworks omit costly externalities that further distort current estimates and future outlooks. This myopic view has created an unsustainable Looking for better metrics system that rewards the short-term and discounts the long-term. But conventional The inappropriateness of using GDP as the metrics and methods of today’s accounting central benchmark for a nation’s success is will not work for a sustainable tomorrow. well noted. The Nobel Prize-winning economist Simon Kuznets, who is often credited as New mandates, new metrics and new the inventor of the metric, warned that GDP methodologies are needed to help companies was not a suitable measure of a country’s and economies recalibrate for the future. economic development or well-being in his 1 Kuznets S. We advocate a rethink on what constitutes National Income, seminal work which redefined how economic 1929-32. Letter value creation as well as how to measure growth should be viewed.1 American from the Acting and monetize it. With a wealth of corporate politician Robert Kennedy summarized it Secretary of sustainability data, analytical tools and well in his election speech in 1968 when he Commerce to the US Senate. 1934. long-term orientation, ESG research and said “it [GDP] measures everything in short, ratings providers like S&P Global will be key except that which makes life worthwhile”. collaborative partners in defining a new way of assessing value that ensures the interests of Some governments are looking for better all stakeholders are represented and aligned. metrics of success. New Zealand is attempting to become the first nation to do without GDP and focus on well-being as a better measure instead. It is part of the Well-being Economy Governments (WEGo) partnership, which currently includes Scotland, Iceland Jacob Messina and Wales, and seeks to build economies that deliver human and ecological well- Senior Sustainable being. Yet while these governments are Investing Strategist pioneering new metrics, the use of GDP as Robeco the primary yardstick with which national success is measured remains to this day. Jan Anton van Zanten Strategist for the Sustainable Development Goals Robeco 12 The Sustainability Yearbook 2021 “What you measure affects what you do”. Joseph Stiglitz Our dependency on GDP complicates a Following this logic through to the long-term sustainable recovery from Covid-19. As Joseph impact on investors, if our accounting systems Stiglitz, former World Bank chief economist do not reward (or penalize) companies for these and Nobel laureate, explains: “What you hitherto non-financial benefits (or damages), measure affects what you do”.2 GDP is the investors are not being properly informed monetary value of all the finished goods and about companies’ true value creation potential. services that are produced