En-Cycles October Seminar
After the speech, the whole room participated in the Q&A discussion facilitated by Arisa.
Question1： Is there any possibility that reporting on CSR issues will become obligatory through national or international legislation?
Peter：In some countries, such legislations already exist in France where companies have a reporting obligation on details of employee training. It is very difficult to lay out legislations with immediate enforcement, and it is also hard to compare reports from different countries because there are no set international standards. However, there are movements to create such common standards, such as the Global Reporting Initiative (GRI).
Question2：You have mentioned that EIRIS never gives advice to investors in order to keep its neutrality. However, don’t you think you also have to responsibility to enlighten public on issues which we should pay attention to in the field of responsible investment? Is there any risk that people will pay too much attention to major issues like climate change and ignore other issues like biodiversity?
Peter：It certainly is a problem that people pay attention to a certain issue and forget others according to short term trends of public opinion. However, climate change is quite a unique topic as it itself includes various other issues, and therefore means that through focusing on climate change one can address many other issues.
At EIRIS, we conduct research regardless of its popularity so long as there is a clients need for it, so we often research on issues which are not well know to the public. We believe it is our duty to provide information about unpopular issues to our clients who have not yet recognized its seriousness and contribute to raise awareness of investors. Biodiversity is already recognized as an issue that is as important as climate change internationally.
Question3：How do you think the current financial crisis will affect SRI?
Peter：It has made us reconsider the transparency of financial firms and what responsible business is. Many people think the “age of greed” has died and the “age of responsibility” is coming. I believe responsible investment contribute to it. The economist Sir Nicholas Stern has said that the cost of not taking action is far greater than the cost of addressing climate change now. The current crisis is a good example of the effects of not dealing with something everyone knew to be a problem.
Question4：When we evaluate “good CSR activity” based on global standards, isn’t there a danger of these standards to have a favorable bias towards Europe, and the potential of screening out all companies from South-East Asia and African countries?
Peter： If a local government does not act sufficiently, the role of companies which reflect opinions of European investors and clients will be very important. In addition, to achieve a global standard will be a large incentive for local companies for being recognized as a global market player. Japan also used to be reluctant in introducing global standard, but increased understanding for these standards have brought acceptance. It is important for companies from countries such as Japan who are outside Europe to be involved in the stage when such ‘global’ standards are being created.
Question5：It is evident that Japanese companies are making a certain level of effort in CSR activities, but I think it is not integrated into the corporate strategies. Is it just because they are not good at communication, or is rooted in the Japanese culture?
Peter：Insufficient communication can be seen as part of the reason. At the same time, companies may not be confident that they can implement outside of Japan the high standards of corporate activities they have done within Japan.
If you are interested in their activities, post a comment on this article or email en_cycles@yahoo.co.jp and they will get back to you for further notice.
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