Belgian bank Dexia has been excluded from the Triodos sustainable investment universe because of its ongoing financing of Israeli settlements in the Occupied Palestinian Territories.
Publishing, paper and deforestation
08-03-2011 | More and more publishing companies – such as Reed Elsevier – are purchasing paper from sustainable sources. Wolters Kluwer, formerly a sustainability frontrunner, has fallen behind in terms of paper sourcing. Engagement efforts have proven unsuccessful and the company has been removed from the Triodos sustainable investment universe.
Paper sourcing at Wolters Kluwer
Triodos Research has been carefully monitoring the Dutch publishing giant Wolters Kluwer for the past four years. Our focus was on the company’s efforts to improve the proportion of recycled and/or certified paper in its printed products. Wolters Kluwer aims to minimise its ecological footprint by increasing the sale of electronic products. This approach has proven successful and over half of sales are now electronic. However, the company continues to use substantial quantities of paper for its printed products and only provides anecdotal information about its paper sourcing.
Dialogue
In 2008, Triodos Research raised concerns at Wolters Kluwer’s Annual General Meeting and specifically requested that it address the topic in its management and reporting systems. In response, the company stated that it would start monitoring paper sourcing that same year. Based on data provided in 2009 and following a further meeting with the company in early 2010, we concluded that several relevant business units do not yet report on paper sourcing and were unable to trace the origin of the paper used.
We once again addressed the issue at Wolters Kluwer’s 2010 Annual General Meeting in April, and urged management to be more proactive. We then had follow up meetings with the company in November. Unfortunately, we concluded that it continues to make insufficient progress and does not meet Triodos minimum standards on paper sourcing and deforestation. Wolters Kluwer was subsequently removed from our sustainable investment universe.
Responsibilities and risks
Responsible paper sourcing and good forest management contribute to a company’s long term value creation. Companies even indirectly involved in unsustainable forms of logging are increasingly exposed to reputational risks, fluctuating costs, delivery shortages and even legal prosecution. Publishing companies consume large amounts of paper for printed products and should avoid involvement in deforestation and illegal logging activities by ensuring that paper is purchased from sustainable and traceable sources.
Deforestation
Deforestation is a major global issue and the United Nations declared 2011 the International Year of Forests to raise awareness of sustainable forest management, conservation and climate change. Although the UN reports that deforestation rates have decreased globally due to local and international efforts, each year an area almost the size of Costa Rica is destroyed. There are some legislative efforts being made, and in July 2010 the European Parliament adopted a bill prohibiting trade in illegally sourced wood.
More information on engagement and our latest Triodos Sustainability Research Engagement Report .
Note: The issues explored in this article are relevant for sustainable investments on the stock market. Triodos Bank believes that our socially responsible investments are a powerful means of promoting our values and working for greater sustainability, while enabling us to offer a complete range of attractive investment options to customers who choose to invest on the stock market.