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Climate-conscious investors are unlikely to support Trump's decision to stop quarterly reporting
Donald Trump's call to abandon quarterly corporate reporting received cautious support from an unexpected source: international investors who are pushing businesses to focus more on sustainability issues over the long term, and many of whom have been lambasted by Trump. Trump called on companies to switch to six-monthly reports, joining the ranks of other business leaders such as Warren Buffett, Berkshire Hathaway chair, and Jamie Dimon, CEO of JPMorgan, who have previously argued that short-termism is bad for the economy. Abandoning quarter-by-quarter reporting would allow the largest economy in the world and its deepest capital markets to join the global movement away from this practice. It could also help investors who are pushing boards to take action on climate change, which is set to have a greater impact on corporate value. "Responsible investors have never advocated quarterly reporting because it encourages a greater focus of trading and less good ownership," David Pitt-Watson said, corporate governance expert at Cambridge University Judge Business School. Trump has been attacking sustainability issues since the beginning of his second term in office earlier this year. This includes a decision to scrap a rule which would have forced companies to disclose data related to climate change. Many investors in Europe, and other parts of the world, want to see these data. "We want companies to consider the material impact of their strategies on a long-term view and plan accordingly to mitigate any sustainability-related risks, so if moving away from quarterly reporting can help achieve this without impacting transparency and disclosure then it could be positive," said Nick Duncan, Sustainable Investment director at investor Aberdeen, which manages more than 500 billion pounds ($682 billion). "Especially if the reduced quarterly reporting burden encouraged companies to maintain or enhance the current level of sustainability-related reporting." He added that the move was a win for investors, as it reduced the time spent by companies in the 'closed' period before results, which is usually a month. Changes to the securities laws that date back decades could be a game changer for the largest capital market in the world, where over 4,000 companies trade publicly with a market capitalisation totaling more than $60 trillion. Investors in the EU, Britain, Australia and New Zealand, as well as Hong Kong, have been dealing with companies' six-monthly reports for many years. China, the largest equity market outside the U.S. still requires it by law, although local stock exchanges in countries like Japan and Germany continue to require it as a requirement for listing or listing on the Premium Market. Andrew Ninian, Director of Stewardship Risk and Tax, The Investment Association (the UK trade body for investment industry), said that the UK had made the switch to interims over a decade earlier. The companies have more flexibility now that they are not required to report quarterly. They can focus on their long-term investments, strategies and reporting instead of managing short-term targets. Investors cautioned that action was needed to strengthen investor protections. Hayley Grafton is a Senior Sustainable Investment Analyst at UK investor Edentree Investment Management. She said: "While semi-annual reporting may work in certain countries such as the UK or Australia, the U.S. context presents a more difficult challenge due to structural differences." Profit warnings are one example of a potential gap. She said that in Britain they are considered regulatory disclosures, while in the U.S. they are not required and can be withheld. The U.S. does not have a similar system to Australia's, which requires companies to provide constant disclosure of material information, and to publish trading updates when performance diverges from the guidance. Pitt-Watson said that despite the need for safeguards – Grafton added that this included monitoring the impact of transparency and capital costs – the move could benefit sustainability investors. As Trump said, the first has knock-on effect distracting management. A move to a half-yearly report might help support long-term management that adds value. "I think most of us agree that this is a positive thing." $1 = 0.7324 pounds (Reporting and Editing by Margueritachoy)
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Trump receives unlikely support from climate-conscious Investors
Donald Trump's call to abandon quarterly corporate reporting received cautious support from an unexpected source: international investors who are pushing businesses to focus more on sustainability issues over the long term, and many of whom have been lambasted by Trump. Trump called on companies to switch to six-monthly reports, joining the ranks of other business leaders such as Warren Buffett, Berkshire Hathaway chair, and Jamie Dimon, CEO of JPMorgan, who have previously argued that short-termism is bad for the economy. Abandoning quarter-by-quarter reporting would allow the largest economy in the world and its deepest capital markets to join the global movement away from this practice. It could also help investors who are pushing boards to take action on climate change, which is set to have a greater impact on corporate value. "Responsible investors have never advocated quarterly reporting because it encourages a greater focus of trading and less good ownership," David Pitt-Watson said, corporate governance expert at Cambridge University Judge Business School. Trump has been attacking sustainability issues since the beginning of his second term in office earlier this year. This includes a decision to scrap a rule which would have forced companies to disclose data related to climate change. Many investors in Europe, and other parts of the world, want to see these data. "We want companies to consider the material impact of their strategies on a long-term view and plan accordingly to mitigate any sustainability-related risks, so if moving away from quarterly reporting can help achieve this without impacting transparency and disclosure then it could be positive," said Nick Duncan, Sustainable Investment director at investor Aberdeen, which manages more than 500 billion pounds ($682 billion). "Especially if the reduced quarterly reporting burden encouraged companies to maintain or enhance the current level of sustainability-related reporting." He added that the move was a win for investors, as it reduced the time spent by companies in the 'closed' period before results, which is usually a month. Changes to the securities laws that date back decades could be a game changer for the largest capital market in the world, where over 4,000 companies trade publicly with a market capitalisation totaling more than $60 trillion. Investors in the EU, Britain, Australia and New Zealand, as well as Hong Kong, have been dealing with companies' six-monthly reports for many years. China, the largest equity market outside the U.S. still requires it by law, although local stock exchanges in countries like Japan and Germany continue to require it as a requirement for listing or listing on the Premium Market. Andrew Ninian, Director of Stewardship Risk and Tax, The Investment Association (the UK trade body for investment industry), said that the UK had made the switch to interims over a decade earlier. The companies have more flexibility now that they are not required to report quarterly. They can focus on their long-term investments, strategies and reporting instead of managing short-term targets. Investors cautioned that action was needed to strengthen investor protections. Hayley Grafton is a Senior Sustainable Investment Analyst at UK investor Edentree Investment Management. She said: "Although reporting semi-annually works in certain countries such as the UK or Australia, the U.S. context presents more challenges due to structural differences." Profit warnings are one example of a potential gap. She said that in Britain they are considered regulatory disclosures, while in the U.S. they are not required and can be withheld. The U.S. does not have a similar system to Australia's, which requires companies to provide continuous disclosures of material information, and to publish trading updates when performance diverges from the guidance. Pitt-Watson stated that despite the need for safeguards which Grafton added included monitoring the impact on the transparency and cost of capital. As Trump said, the first has knock-on effect distracting management. A move to a half-yearly report might help support long-term management that adds value. "I think most of us agree that this is a positive thing. $1 = 0.7324 pounds (Reporting and Editing by Margueritachoy)
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Argentina's Milei will partially privatize the nuclear power plant operator
His spokesperson announced on Tuesday that the Argentine president Javier Milei would sign a decree aimed to partially privatize the company responsible for three nuclear power plants in operation. The libertarian leader is continuing his pledges to reduce the size of state. Manuel Adorni, a spokesperson for the Milei administration, told a news conference that the administration plans to sell 44 percent of Nucleoelectrica Argentina, which operates Atucha I and Atucha II power plants as well as Embalse, in an international public auction. He added that the state would keep a 51% share in the company, and also set up a program of joint ownership for up to 5%. Adorni reiterated that the South American nation's state-run businesses are all subject to privatization. Milei was elected in December 2023, promising to reduce spending to bring the public finances into balance and to tame an annual inflation rate that reached triple digits. In a separate announcement, the government stated that private investments were crucial to increasing access to capital and diversifying risks as well as ensuring the continuation of NA-SA operations in an efficient and competitive manner. A group of workers from Argentina's National Commission for Atomic Energy and Nuclear Activity has criticized the decision. They claim that the government should be in a position to oversee the development and safety nuclear energy and that partial privatization will result in higher electricity prices. In a press release, it stated that privatizing NA-SA would not improve the lives of people, but instead encourage citizens to pay the difference in order to boost the profits of a private firm.
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In court, creditors scrutinize Elliott affiliate’s bid for Citgo parent
The creditors lining up to receive proceeds from an auction of Citgo Petroleum parent PDV Holding in a U.S. Court began the examination process in front of experts, advisors, and an executive of Elliott Investment Management whose subsidiary Amber Energy emerged as the winner of the bidding round. Amber Energy's bid of $5.9 billion for Citgo parent PDV Holding, recommended by a court official last month as the winner of the auction to compensate 15 creditors due to debt defaults and expropriations from Venezuela. The bid is defined by a $2.1billion payment agreement with holders a defaulted PDVSA bond that was collateralized using Citgo equity. Gold Reserve, junior creditors, and Venezuela objected to the choice, arguing that bondholders must first win an independent New York court case regarding the validity of notes before they can claim compensation. The Delaware court, as part of an 8-year case, has been trying to complete the auction for shares of PDV Holding since last year in order to satisfy claims of up to $19 Billion from debt defaults or expropriations made against Venezuela, its ultimate owner. Delaware Judge Leonard Stark said on Monday that he would decide the winner of the auction after the hearing which will continue through Thursday or next month, if the court set a new date to hear more arguments. Amber's bid last year was not accepted by the creditors. The court changed the structure of the auction this year and organized two new rounds. In the final stages of the auction, the resolution of parallel legal cases involving the same assets prompted improved bids. Michael Turkel, Elliott's lawyer, told the court that "we probably learned our lesson in respect to the Amber bid." We didn't realize the necessity and importance of interacting with the writholders and understanding how our bid could not only be a purchase for us but also a solution for them. Lawyers asked whether Amber's bid and the pact it had with bondholders would still stand even if the New York case was lost. William Hiltz said that, if the bondholders won their case, Amber’s bid will move forward. He added that if they lose, the court can still move forward with Amber's offer or begin a rapid re-bidding procedure. Amber declined to make a comment. The parties also discussed the challenges of obtaining antitrust clearance, and inquired about Elliott's involvement in rival energy companies including Phillips 66. This year, a conflict of interest alleged by Elliott was raised following its acquisition of a stake at the U.S. refining company. (Reporting and editing by Nathan Crooks, Matthew Lewis and Marianna Pararaga)
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Germany's VAC wants to increase US magnet production; Europe is behind in rare earths
Vacuumschmelze, one of only a few rare earth magnet manufacturers outside China, is seeking Washington's help to expand production at a new U.S. facility. This contrasts with the tepid support for similar plans in Europe. It is imperative that the West establishes its own supply of permanent magnets, as China produces 90% of these products, which are vital to defence, electric vehicles, and wind turbines. VAC CEO Erik Eschen stated that the U.S. is pushing harder than Europe for a domestic rare-earths sector. This can be seen by its magnet factory in South Carolina, which aims to open before the end of this year. "European governments have started to wake up, but are still far behind the United States." VAC has said that it has received approximately $200 million from the U.S. government in funding and tax credits to build the $500-million plant. Eschen said in an interview that "we have a great deal of technology in Europe, and we are transferring this technology to the United States." In July, the U.S. Department of Defense signed a multi-billion dollar deal with MP Materials which operates the U.S.'s only rare earths mine. VAC, a private equity company owned by ARA Partners is ahead of schedule in opening its magnet factory, which has a capacity just under 2,000 metric tonnes a year. He added that up to 90% of production will be used to supply General Motors' EVs. The remainder would go to the U.S. Department of Defense. China's decision to restrict magnet exports as part of the trade dispute with U.S. president Donald Trump in April, which has been easing over recent months, highlighted the need for Western action in rare earths. In Europe, EU wants to create a sector for rare earths, magnets, and other critical raw materials, in part through the Critical Raw Material Act, which was agreed upon in 2023. VAC, a company that has been around for over 100 years, currently produces 1,000 tons of magnets in Europe each year, but it is eager to expand. Eschen stated that they were looking to build a few factories in Europe, similar to the ones currently being built in America. We are in negotiations, discussions with several suppliers as well as with various governments who have an important interest. He added that individual European governments could move faster than the EU which must build consensus between its 27 members. Eric Onstad is the reporter. (Editing by Veronica Brown, Mark Potter and Veronica Brown)
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US provides nearly $156 Million in funding for Michigan reactor restart
A source familiar with the matter confirmed on Tuesday that the U.S. has disbursed $156 million as the latest installment in a loan guarantee to Holtec International for its Michigan nuclear power station, the company's hope being that it will be the nation's first reactor to restart following a shutdown. The Loan Programs Office of Department of Energy has disbursed the sixth installment of approximately $491 million of the maximum $1.52 billion of loan guarantees that were approved during the term of former President Joe Biden. Entergy, a power company, closed Palisades after more than 50 years of operation in 2022. The plant shut down two weeks earlier than planned due to a problem with a control bar, despite the $6 billion federal program designed to save reactors from increasing costs. Donald Trump, the president of the United States, supports nuclear energy as U.S. electricity demand is on the rise for first time in 20 years due to data centers and artificial Intelligence. Holtec intends to restart Palisades during the fourth quarter. Trump signed executive order in May to speed up the issuance of new nuclear licenses and to overhaul the Nuclear Regulatory Commission that issues them. Holtec was granted approval by the NRC to load fuel in the reactor this July. (Reporting and editing by Timothy Gardner, with Chizu Nomiyama)
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Petrobras hires Engeman as the manager of fertilizer plants for Bahia and Sergipe in Brazil
Petrobras, the state-owned oil company of Brazil, has announced that it has hired Engeman Industrial Services to manage fertilizer plants in Bahia e Sergipe. Petrobras announced in a press release that the contract for the operation and maintenance of nitrogen fertilizer plants had been signed on Friday, following the completion of an auction. Petrobras says that the plants will be operational again by the end this year. The contract value was not disclosed. According to its website, Engeman provides services in several sectors, including mining, oil and gas and energy. The two plants, if they were to be put back into operation, would reduce Brazil's dependence on imports of fertilizers, which are mainly from Russia. The Luiz-Inacio da Silva administration has made reducing reliance on imported fertilizer a top priority. Petrobras leased two nitrogen fertilizer facilities to Unigel under a 10-year contract in 2019. However, both plants have been closed since 2023. Unigel has cited unfeasible conditions for operating due to the high natural gas price in Brazil. In May, the two companies reached an agreement to resolve legal disputes regarding two fertilizer factories and restore Petrobras ownership of these plants.
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Investors on edge as TSX drops ahead of monetary Policy Meetings
Investors were on edge as they awaited the announcements of the Bank of Canada, and the U.S. Federal Reserve, later this week. The Toronto Stock Exchange S&P/TSX Composite Index fell 0.3% to 29,339.94 by 10:00 ET (1400 GMT), but remained close to the record high of Monday. The annual inflation rate in Canada rose by 1.9%, mainly due to higher petrol and food costs, but it was still below the 2% predicted by analysts. In a note, Andrew Grantham, senior economic analyst at CIBC Capital Markets said that core inflation measures are likely to continue to fall in the months to come, due to the slack in the economy, and the removal of many retaliatory duties on September 1. We not only expect a reduction of 25bp tomorrow, but also a subsequent one at the October meeting. Money markets expect the BoC to cut its rate on September 17 by a quarter-point. This is a 97% probability. The TSX and other global markets have reached record highs in the last few sessions. Markets are fully pricing in a Fed interest rate cut this coming week. Gold mining stocks dropped 0.7% on the day. New Gold, Orla Mining, and Alamos Gold fell between 2% to 3.8%. Chartwell Retirement Residences fell 1%, while Bausch Health dropped 1.9%. Vermillion Energy, Parex Resources and energy index both increased by 2.3%. Teck Resources, among other stocks, lost 2.2%. The Canadian industry minister said she will be meeting with the CEOs of Teck Resources and Anglo American to discuss their proposed merger next week. (Reporting and editing by Vijay Kishore; Twesha Dhikshit)
Brazil prompts G20 leaders to move much faster on net zero climate targets
Brazilian President Luiz Inacio Lula da Silva on Tuesday advised leaders of the Group of 20 major economies to accelerate their national environment targets, calling on them to reach net no climate emissions 5 to ten years ahead of schedule.
Opening the last session of the G20 top in Rio de Janeiro, Lula recommended countries bring forward their targets to reach climate neutrality by 2040 or 2045, rather of 2050 as Brazil and lots of others have pledged.
We need to do more and much better, Lula stated, keeping in mind that this is most likely the world's hottest year on record as environment catastrophes such as flooding and droughts end up being more frequent and intense. There is no time at all to lose, he included.
World leaders are trying to fortify an international reaction to environment change before Donald Trump retakes the U.S. presidency in January, when he plans to roll back U.S. policy on international warming and apparently leave the landmark Paris Contract.
Argentine President Javier Milei functioned as a tip in Rio of those changing winds, fresh off of going to Trump at his Florida resort. Milei told G20 leaders he challenged a joint communique promoting gender equality, tax of billionaires and sustainable development, according to individuals in the conference.
Lula rushed through approval of the G20 leaders' joint statement on Monday, protecting a consensus on climate modification however bugging some European nations that desired stronger language on the escalating war between Ukraine and Russia.
The joint statement called for rapidly and significantly increasing environment finance from billions to trillions from all sources to challenge global warming.
G20 countries are seen as crucial to shaping the reaction to global warming, as they represent 85% of the world economy and more than three-quarters of climate-warming emissions.
The joint declaration also prompted arbitrators at the U.N. environment top COP29 underway in Azerbaijan to reach an offer on a. new monetary goal for how much cash abundant countries should offer. to poorer establishing countries in climate finance, the primary. sticking point in the climate talks.
At the G20 top on Tuesday, when leaders turned their. conversation to the environment, Lula prompted establishing countries. to broaden their environment targets to resolve all emissions that. trigger global warming, not just from specific sectors or gases.
U.S. President Joe Biden told the gathering that establishing. nations need to have adequate firepower and access to capital. to slow climate change and protect their countries from its. results. That cash needed to flow into their economies and give. breathing space to debt-laden nations.
History is seeing us, Biden stated. I urge us to keep the. faith and keep going. This is the single biggest existential. hazard to humankind.
COP29 TALKS
At the leaders meeting on Tuesday, Lula proposed the. development of a brand-new council at the United Nations to accelerate. the application of the Paris Agreement on environment modification.
He likewise criticized industrialized nations for disappointing. a promise to deliver $100 billion of environment funding every year. to developing countries by 2020.
Lula kept in mind settlements at COP29 on the new monetary goal,. which might reach more than a trillion dollars.
Those talks, set to conclude on Friday, have actually bogged down as. industrialized countries require more nations to contribute towards. the objective, while the developing world argues that the abundant. countries most responsible for environment modification require to pay up.
The G20 leaders' statement on Monday stated nations must break. the deadlock on financing, however they did not offer clear assistance on. an option.
G20 leaders have sent a clear message to their mediators. at COP29: do not leave Baku without an effective new financing. objective. This remains in every nation's clear interests, U.N. climate. primary Simon Stiell said in a statement reacting to the G20. communique.
Climate negotiators aim to produce a full draft of a deal. for the monetary objective by Wednesday evening, said the summit's. lead arbitrator Yalchin Rafiyev of Azerbaijan.
We have stepped up the speed, Rafiyev said. The result. will just be as good as parties' dedication to help us construct. services.
The G20 also devoted to settling on a legally binding. treaty to limit plastic contamination by the end of 2024, with talks. resuming next week to hammer out an offer 2 years in the making.
(source: Reuters)