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Definitions

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Cc

Clean Revenue Classification System (Clean Revenue Taxonomy) - Developed by Corporate Knights, system that classifies G&S across all sectors having clear environment and - in limited number of well-defined cases, social - benefits. The system is reviewed and updated annually. Aligned with SASB standards, EU Sustainable Finance Taxonomy, CBI Taxonomy and many others.

Brought to you
by Corporate Knights




Circular Economy - Concept that is based on the principles of designing products and materials where the waste and pollution are incorporated into the life cycle of a product, so that the materials used in the creation of the goods are recovered and regenerated at end of each service life.

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by Corporate Knights




Clean Natural Gas (Green Natural Gas/Renewable Natural Gas RNG) - A gas typically from decomposing organic waste that is purified and can be distributed through existing gas grids.

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by Corporate Knights




Climate-Related Risks and Opportunities - Climate change presents risks and opportunities to businesses related to the physical impacts of our changing climate (such as extreme weather events) and the transition to a low-carbon economy, transitioning away from fossil fuels to renewable electricity generation and other forms of energy. Climate change will enhance risk related to markets, supply chain, policy/legal and reputation. Businesses who recognize and plan for these risks can capitalize on opportunities for new products and services aligned with the global shift to a low-carbon economy.

Brought to you
by Mantle314




Community Grievance Mechanism - A community grievance mechanism is a process for receiving, investigating, responding to, and closing out complaints or grievances from affected communities in a timely, fair, and consistent manner. CGMs work best as integral components of a company’s overall approach to community engagement, not as stand-alone processes or as a substitute for engagement. Without ongoing engagement, a CGM may be the only channel for external stakeholders to access a company, and may be used to make claims that are designed solely to gain company attention or that have already become acute and could threaten operations.

Brought to you
by Triple R Alliance





Corporate Social Responsibility (CSR) - The company’s approach to managing environmental and social factors that are relevant for a broad range of corporate stakeholders, including employees, customers and communities. ESG is a subset of CSR factors that can impact company value and investor decision-making. CSR factors can evolve rapidly to become ESG factors. Related terms: sustainability, corporate responsibility, corporate citizenship.

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by ESG Global Advisors







Dd

Decision-useful information - Information that is useful to existing and potential equity investors, lenders and other creditors in making decisions in their capacity as capital providers. Such information allows investors to form an opinion as to the risk profile, long-term prospects, and valuation of a company, in order to make an optimal investment decision. Characteristics of decision-useful information:
  • consistent over time (i.e. same topics and metrics from one year to the next)
  • comparable among peers (i.e. same topics and metrics for similar companies)
  • balanced (i.e. transparent, credible, holistic representations)
  • reliable (i.e. internally and/or externally verified)
  • understandable (i.e. using plain language)
  • timely (i.e. within a reasonable delay)
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by FinComm







Ee

Environmental, Social, and Governance (ESG) - Environmental, social and governance factors that can impact company value and investor decision-making:
  • Governance factors include board quality, independence and accountability; board oversight of executive performance; and board oversight of company strategy, risk management, performance and disclosure, including for environmental and social factors
  • Financially-material environmental and social risks and opportunities such as climate change, water use, human capital management and safety
Brought to you
by ESG Global Advisors





Expectation Management - To be successful, a company needs to manage stakeholder expectation, which are based on real or assumed prior expectations. prioritize and clarify their customers expectations and then deliver while proactively managing expectations effectively. There are practical ways to address expectations, which have both an internal component (such as avoiding that staff inadvertently raise expectations as well as an external component (such as clarifying when perceived company promise is a real promise).

Brought to you
by Triple R Alliance







Ii

Impact Investing - Investing with the specific intention of generating measurable positive social or environmental impacts, while seeking to achieve a financial return that may target either market or below-market rates. The impact criteria define and limit the universe of eligible investments. Investments may focus on themes, such as water or energy efficiency.

Brought to you
by ESG Global Advisors




Integrated Reporting - Integrated reporting is a concept developed by the International Integrated Reporting Council (IIRC). An integrated report is a concise communication about how an organization’s strategy, governance, performance and prospects, in the context of its external environment, lead to the creation of value in the short, medium and long term.

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by FinComm




Investor Stewardship - Investor Stewardship encompasses investors engaging with companies to promote strong corporate governance practices, in order to create long-term value for shareholders and more widely, society. Examples of effective investor stewardship would be company engagements on specific issues, proxy voting, and engagements on wider public policy issues.

Brought to you
by Millani







Mm

Materiality - In capital markets, an issue is deemed material if there is significant likelihood that a “reasonable investor” would consider it important in their investment decision process about buying, selling or holding a security or when voting.

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by Millani







Pp

Principles for Responsible Investment (PRI) - The Principles for Responsible Investment (PRI) is an institutional investor initiative launched in 2006 in partnership with the UNEP Finance Initiative and the UN Global Compact. The organisation’s primary purpose is to promote the six Principles for Responsible Investment, a voluntary and aspirational set of investment principles that offer possible actions for incorporating environmental, social, and governance (ESG) issues into investment practice.

Brought to you
by FinComm







Ss

Scenario Analysis - Climate scenario analysis explores what a company’s business environment might look like under different climate scenarios, such as deep decarbonization aligned with the Paris Climate Agreement, so as to integrate this information into a company’s strategy. Scenarios provide foresight to consider and manage the complexity that climate change presents to business decisions.

Brought to you
by Mantle314




Social Performance / Integrated social performance - Social performance is the sum of a company’s interactions, activities and outcomes that can affect its stakeholders. Achieving good social performance means that a company needs to apply the same focus and rigor to the social aspects of the business as it does to every other part of the business. In other words, every employee and every contractor have a shared responsibility to get it right when it comes to potential social impacts, risks, and opportunities that relate to every company decision.

Brought to you
by Triple R Alliance





Social Performance Management System - A social performance management system is the sum of the components that provide as an effective and organized way of integrating social concerns into management decisions such that social risks are controlled, project impacts are mitigated and relationships are maintained.

Brought to you
by Triple R Alliance





Social Risk - Social risk is risk to the company (as opposed to risk to people, which is typically referred to as an impact) as a result of behavior and action of stakeholders. Social risk can manifest itself as a result of company policies, approaches or behavior or, alternatively, it can be caused be external factors such as the socio-political context of operations. If not adequately managed, social risk can result in opposition to the project, reputational and legal costs.

Brought to you
by Triple R Alliance





Socially Responsible Investment (SRI) - An investment strategy that includes or excludes investments based on the application of positive or negative screens, which come from a defined set of values.

Brought to you
by Millani




Stranded assets - A stranded asset is an asset that loses economic value well ahead of its anticipated useful life, whether that is a result of changes in legislation, regulation, market forces, disruptive innovation, societal norms, or environmental shocks. Stranded resources are resources that are considered uneconomic or cannot be developed or extracted as a result of technological, spatial, regulatory, political or market limitations, or changes in social and environmental norms.

Brought to you
by FinComm




Sustainable Finance - Capital flows, risk management activities, and financial processes that assimilate environmental and social factors as a means of promoting sustainable economic growth and the long-term stability of the financial system.

Brought to you
by FinComm







Tt

Task Force on Climate-Related Financial Disclosures (TCFD) - In 2017, the G20’s Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD) released recommendations for climate reporting. The TCFD recommendations are widely recognized as best practice for financial and non-financial businesses reporting on climate change risks and opportunities. The recommendations call for businesses to provide 11 climate-related financial disclosures structured around governance, strategy, risk management, and metrics and targets, covering processes related to climate-related physical and transition risks and opportunities.

Brought to you
by Mantle314