Environmental Investment Organisation

The Environmental Investment Organisation (EIO) is a UK-based not-for-profit body dedicated to researching, proposing and implementing solutions to climate change. It has developed the Environmental Tracking (ET) concept into two separate components known as the ET Carbon Rankings and the ET Index Series. The ET Carbon Rankings rate companies based on their greenhouse gas emissions intensity and transparency. The EIO claims its ET Index Series, which is based on the rankings, can provide a market mechanism capable of applying pressure to company share price.

Origins

The EIO was set up as in 1996[1] by London School of Economics Alumni, Michael Gill, as a parallel body to the LSE Environmental Initiatives Network (EIN).,[2][3] Michael Gill co-founded the LSE EIN with Janos Abel and was the EIN's first elected chairman [4] stepping down in 2003 to become the Vice-Chairman.,[5][6]

Publications

The EIO has commissioned two publications: Environmental Tracking - Can Investment Revolution Prevent Ecological Catastrophe (1997);[7] and more recently A Solution to Global Warming... (2009).[8] The original book proposed the concept of Environmental Tracking, which envisaged using the power of the stock market, primarily through index funds, as a means to incentivise companies to reduce their emissions. In the book Gill proposed the creation of an Environmental Scoring Panel (ESP),[9] which would evaluate companies based on a range of environmental criteria. This environmental scoring would then be used to weight companies within an index. With the emergence of climate change as the overriding concern of the 21st century, however, the concept was refined to focus specifically on corporate greenhouse gas emissions.[10] This was also facilitated by improved rates of corporate emissions disclosure as witnessed by response rates to the Carbon Disclosure Project's annual questionnaires to the world's largest companies, which asks them to provide data on their emissions.[11]

Following the launch of the UK 100 Carbon Ranking an accompanying report was produced highlighting the inconsistent nature of emissions reporting.[12]

ET Carbon Rankings

The EIO launched its pilot rankings in 2010.[13] These included the ET Europe 300, North America 300, Asia-Pacific 300, BRIC 100, ET Global 1000, and ET Global 800. The pilot rankings were based on absolute emissions across Scope 1, 2 and 3 emissions.[14] The EIO methodology at the time only accepted Scope 3 emissions which were verified to a 'reasonable level of assurance' by an independent third party.[15] Since then, the methodology has been changed to rank companies according to emissions intensity. It currently focuses solely on Scope 1 and Scope 2 emission, which the EIO says is an interim measure while waiting for the new GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard [16] to be introduced.

Footnotes

  1. ↑
  2. ↑
  3. ↑
  4. ↑
  5. ↑
  6. ↑
  7. ↑ Environmental Tracking - Can Investment Revolution Prevent Ecological Catastrophe
  8. ↑ http://www.amazon.co.uk/dp/1445261243
  9. ↑ Michael Gill, Environmental Tracking - Can Investment Revolution Prevent Ecological Catastrophe, Pen Press 1997.
  10. ↑ http://www.amazon.co.uk/dp/1445261243/
  11. ↑ https://www.cdproject.net/
  12. ↑ http://uk.reuters.com/article/2011/02/16/uk-emissions-rankings-idUKTRE71F02O20110216
  13. ↑ http://www.businessgreen.com/bg/news/1802481/carbon-index-cranks-pressure-blue-chips
  14. ↑ http://www.ghgprotocol.org/
  15. ↑ http://www.eio.org.uk/etindex.php?page=verification_leaders
  16. ↑ http://www.ghgprotocol.org/standards/product-and-supply-chain-standard

See also

Carbon Disclosure Project
Index fund
EIO Website