ESG: CAC 40 Companies Are Becoming More Transparent

For the third year in a row, the FIR is publishing a “commitment report” which aims to evaluate the degree of transparency of CAC 40 companies regarding their environmental and social commitments. The objective? To renew the shareholder dialogue between listed companies, investors, and stakeholders. An initiative welcomed by Lucie Pinson, Managing Director of Reclaim Finance:

This dialogue will allow investors to better understand the activity of the companies in which they invest and thus be able to challenge them in the transformation of their business model to meet social or environmental objectives.

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Each year, the FIR sends a list of questions to CAC 40 companies

The answers are given in writing. This year, the number of questions has been reduced from 13 to 10 “in order to increase the quality of the answers”, says the press release:

Three questions in the “environment” category (alignment with the Paris Agreement’s 1.5-degree goal, consideration of biodiversity maintenance and resource scarcity)
Four questions in the “social” category (application of ESG criteria, new organizational methods, the issue of living wages, employee savings funds)
Three questions on “governance” (fiscal responsibility, responsible lobbying, integration of social partners in decision-making)

The FIR warns about the intention of this report, as Lucie Pinson reminds us: “It is a rating of transparency, not of the quality of the action that can be taken by a company on the indicators judged.” The answers of companies can “leave the door open to a form of greenwashing that stakeholders will be able to identify when reading the full answers”, says the report.

TotalEnergies and Orange top the ranking

The FIR notes better transparency of listed companies, three-quarters of which have seen their score increase over the last three years, with more detailed answers, demonstrating “a growing sense of seriousness.” The average score has risen from 1.26/3 in 2021 to 1.33/3 in 2022.

Another lesson is that companies are taking better account of issues related to decarbonization and the maintenance of biodiversity. However, the association of responsible finance actors reports a “lackluster performance” on the subject of decent wages. “This echoes all the debates on value sharing and super-profits. Yet very few groups are responding to these wage limitation issues. Is it possible to transform the economy without questioning the sharing of value?” asks the founder of Reclaim Finance.

In detail, TotalEnergies and Orange top the ranking, followed by Michelin. At the bottom of the table, we find Airbus, STMicroelectronics, Teleperformance, and Pernod Ricard. This lack of transparency can hardly reflect real commitments on the part of these companies.

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(Featured image by sergeitokmakov via Pixabay)

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