Political correctness – POLITICO

Posted: October 15, 2021 at 9:13 pm

DIVERSITY DIVIDES Its become conventional wisdom that diversity and inclusion are good for business. But new research reveals that corporate thinking on the subject is far from clear-cut.

One in three corporate directors say board diversity will happen naturally, down from 71 percent in 2020. In other words, directors now acknowledge they have to be deliberate, according to an annual survey from accounting giant PwC, also known as PricewaterhouseCoopers.

And more than half the 851 directors surveyed support tying executive compensation to diversity and inclusion goals.

But dig deeper into the report and youll find this: A growing number of directors 58 percent say the diversity push is driven by political correctness. Thats up 6 points from 2020. More than 1 in 4 directors say the push for diversity results in the board nominating unqualified candidates.

This years report is a story of disconnects, said Maria Moats, leader of PwCs Governance Insights Center. Boards understand diversity wont fix itself. But theyre not quite all-in.

The share of corporate directors from racial minority groups was extremely small in 2020. At the countrys largest companies, only about 5 percent of directors were Black and only 3 percent were Latino. Women make up 28 percent of directors on S&P 500 boards, up from 16 percent in the past decade, but theyre predominantly white.

And even though almost half of directors think one or more of their fellow board members should be replaced, thats not happening.

Boards have to assess whether they have the right people to deliver a strategy for the future, and then replace some members, Moats said in an interview.

Nearly two-thirds of directors say environmental, social and governance goals, or ESG, are linked to their companys strategy, a 15-point jump over past year. But only 25 percent said their board understands ESG risks very well. And the vast majority, 67 percent, dont think associated disclosures from climate risk to workforce diversity should be mandatory.

The survey lands as the SEC prepares rules to require publicly traded U.S. companies to report climate risk and disclose more information about workforce diversity. Chair Gary Gensler said it might take the agency until early next year to get the climate disclosure rule out, a longer timeline than many had anticipated.

A proposal for human capital disclosure, which could include diversity and compensation data, likely will reach SEC commissioners next spring, Gensler said.

The Senate, by unanimous consent on Thursday, declared Oct. 8, 2021, National Hydrogen and Fuel Cell Day. Once again, we missed the festivities. Hope there was ice cream.

Any other parties coming up? Send invites to [emailprotected] and [emailprotected]. Follow us on Twitter @ceboudreau and @Woellert. FOMO? Sign up for The Long Game.

We couldnt have done it this week without Shayna Greene and Bjarke Smith-Meyer. Thanks!

A message from Toyota:

We should be united in an EV future. Not divided. Learn More.

Allbirds Inc. says the sheep that provide wool for its footwear live the good life. But as the startup prepares to go public, its encountering pushback for that claim and others.

People for the Ethical Treatment of Animals has described the sheep raised by Allbirds suppliers as tormented and accused the company of understating its carbon footprint. Then came a class-action lawsuit in June.

Amid the turmoil, the shoe company last week amended its investor prospectus for the third time, dropping about half the references to its sustainability principles and objectives framework, the Financial Times reports. The updated prospectus also omits the claim that Allbirds is conducting its IPO, while following the SPO framework.

Chevron Corp. will aspire to reach net-zero emissions from operations by 2050 and aims to reduce carbon intensity by 5 percent from 2016 levels by 2028 for the lifecycle of its products, including Scope 3 emissions from customers, which make up the majority of fossil fuel pollution.

The company said it could survive a rapid shift from fossil fuels but doubts things will move quickly in that direction. In its latest climate change resilience report, the energy company singled out a scenario from the International Energy Agency for criticism, calling it highly unlikely and inherently speculative.

You might remember that IEA report. It drew global headlines for laying out a path to net-zero emissions, one that required a lot of sacrifice from fossil fuel companies. The multinational group, organized under the OECD, commands attention from governments that pay close heed to its work.

Chevron wasnt impressed. The IEA call to action, the company wrote, requires immediate and unprecedented action: globally coordinated policy design, strong international cooperation, vast capital redeployment, new infrastructure build-out, accelerated technology deployment, and a threefold improvement in energy efficiency that to date has not been forthcoming.

The IEA pathway assumes carbon prices grow some fivefold by 2050.

It is not reflective of any realistic current projections, especially in terms of global cooperation, Chevron wrote.

WASHOUT Nonprofit research group Climate Central today released more than a thousand pictures and videos showing places that could be underwater if governments fail to limit greenhouse gas emissions.

In a worst-case scenario, the high-tide line could encroach on land occupied by about a billion people. If world leaders can meet the most ambitious goals of the Paris Climate Agreement, that exposure could be cut in half, researchers wrote in a peer-reviewed paper in Environmental Research Letters.

Asian nations will be the hardest-hit. Then theres Washington, D.C., which sits between two rivers and is built on a network of creekbeds. The National Mall, the Ellipse near the White House, and parts of Capitol Hill could be flooded if temperatures rise by 4 degrees Celsius. Nationals Park, huddled against the Anacostia River waterfront, could have a permanent washout.

BETTER LATE THAN NEVER? More than five months after the launch of the Net-Zero Banking Alliance, JPMorgan Chase & Co. said it would join the group and take its lending and investment portfolios net-zero. JPM, which has been conspicuously absent from the alliance, is one of the worlds largest funders of fossil fuels. The bank reduced its exposure during the pandemic.

Environmental groups last week accused U.N. special envoy Mark Carney, who leads the net-zero banking and other financial alliances, of facilitating the watering down of net-zero rules for finance and said alliance members have failed to adopt International Energy Agency findings.

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DELIVERY IN PROGRESS With just three weeks to go before COP26, the U.N. climate change summit in Glasgow, Scotland, theres plenty of rhetoric and virtual spilled ink but little to report on actual progress. With a U.S. spending bill and infrastructure package still mired in congressional politics, President Joe Biden has nothing from lawmakers to take to the meeting. Other national pledges could remain just that.

Its not that encouraging that the promises made at COP26 will be followed through, Douglas Flint, chair of investment company abrdn plc, said Monday at an annual meeting of the Institute of International Finance.

In Paris, COP President-designate Alok Sharma warned that governments need to deliver concrete action to cut coal, boost electric cars, protect trees and reduce methane emissions, and honor a $100 billion pledge to help small and vulnerable economies.

The meeting, which begins Oct. 31, is the first significant climate gathering since the Paris Climate Agreement was signed in 2015.

COP26 is not a photo-op, Sharma said in his speech Tuesday. It must be the forum where we put the world on track to deliver on climate. And that is down to leaders.

Sharma also said the conference would make funds available to cover costs to delegates and others from developing countries if they contract Covid-19 during their stay and have to isolate in Glasgow.

ICYMI, Pope Francis, 84, is staying home. Cardinal Secretary of State Pietro Parolin will represent the Holy See in Glasgow.

A message from Toyota:

We should be united in an EV future. Not divided.

Proposed EV tax credit legislation will apply only to certain carmakersputting thousands of dedicated American auto workers at a disadvantage. Learn more about how this tax credit should be applied equally to all manufacturers.

THE TAXMEN COMETH Policymakers from 136 countries on Friday committed to overhauling corporate tax rules so that giant companies pay their fair share. The deal would set a 15 percent global minimum corporate tax for the largest companies and could raise an additional $150 billion in revenue globally. Treasury Secretary Janet Yellen called it a victory for the U.S., but dont count those chickens yet. Congress needs to pass legislation for the deal to take effect.

Felicia Wong, president and CEO of the Roosevelt Institute, a progressive think tank, called the move important for democracy.

When 136 countries can come together, we can prevent the world's largest corporations from hoarding wealth and power at the expense of the world's citizens," Wong said.

Oh, hello! | Martin Meissner/AP Photo

They're back! Pink flamingos have returned to Kazakhstans capital after a five-year absence, the U.N. reports.

As they push to protect biodiversity, scientists point to the potential medicinal benefits of fungi that grow on sloths, and other cool stuff. The Guardian has details.

Indigenous activists are protesting in front of the White House this week. They want Biden to end new fossil fuel projects and declare a climate emergency, The Washington Post reports.

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Political correctness - POLITICO

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