London Stock Exchange joins Sustainable Stock Exchange Initiative
The LSE Group has joined nine other global exchanges participating in the United Nation Sustainable Stock Exchanges Initiative (SSE) in which listing authorities commit to encourage sustainable investment and corporate transparency on environmental, social and corporate governance issues.
The 2nd July announcement sees the LSE join with partner exchanges across the developed world and emerging markets including Brazil, India, South Africa, the NYSE Euronext and NASDAQ.
Originally launched in 2009 by Ban Ki-moon, the addition of the London Exchange is seen as a breakthrough for the SSE which is backed by a group of international sustainability heavyweights including UNCTAD, the UN Finance Initiative and the Principles for Responsible Investment (PRI).
‘Stock exchanges have a crucial role to play in enhancing both the quality and quantity of environmental, social and corporate governance reporting by companies listed on their exchanges, and we are pleased to welcome the London Stock Exchange to the UN SSE initiative.’
‘Only 3 percent of the world’s largest companies currently disclose information about their ESG performance.’
‘Better disclosure will improve the usefulness and comparability of information being reported in each market, enabling institutional investors to better manage risk and make more informed investment decisions.’
'Those companies that improve their internal ESG measurement and subsequent disclosure around emerging common global standards are the companies that will be best position for tomorrow, to attract and retain support from decision makers and asset owners looking for sustainable returns’ Fiona Reynolds, CEO Principles for Responsible Investment said.
‘Given our role at the heart of global financial markets, we are in a unique and privileged position to promote sustainability and corporate responsibility’ Mark Makepeace from the LSE Group commented.
According to an October 2013 benchmarking report into global stock exchanges by Canadian sustainability research and advisory firm CK Capital, the London Exchange sat just outside of the Top 10, at No 11, the ASX at 17, Hong Kong at 23 and New York down the list at 33.
Further developments on this initiative are expected to be discussed by global stock exchanges at their Sustainability Working Group later this year and members of the SSE will also be meeting as part of UNCTADS 4TH World Investment Forum in early October.