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September 13, 2014
Bank of America Delisted from Leading Sustainability Index
    by Robert Kropp

The bank, which had been listed on the Dow Jones Sustainability Indexes despite its leading role in financing coal projects, is delisted in 2014, but questions remain over some of the Index's industry sector leaders and other constituents.


Originally launched in 1999, the Dow Jones Sustainability Indexes (DJSI) remain one of the more influential families of sustainability indexes. The indexes include the top 10% of the largest 2,500 companies in the Dow Jones Global Total Stock Market Index, ranked according to their economic, environmental, and social performance.

The 2014 update of the indexes was announced this week. According to RebecoSAM, the research firm that supplies the data for the indexes, “The 2014 methodology was updated to reflect rising emerging sustainability challenges that companies face and that are considered to be critical for their long-term success.”

Added to the Indexes this year were Amgen, the Commonwealth Bank of Australia, and GlaxoSmithKline. And in a move that surely must be considered a win for advocates of environmental responsibility by financial institutions, Bank of America was delisted. The inclusion of Bank of America in last year's DJSI generated a share of controversy, as the bank was then one of the leading financiers of coal projects. “While Bank of America claims to support environmental responsibility, it continues to lead investments in coal, one of the biggest threats to public health and climate stability,” the Rainforest Action Network (RAN) stated.

Also delisted this year were General Electric and Schlumberger.

As a resident of Vermont, the inclusion of at least one US-headquartered corporation gave me pause. Entergy is the owner of the Vermont Yankee nuclear power plant, scheduled for decommissioning later this year. Entergy used its corporate treasury to mount expensive legal actions to deny the state its right to determine an energy future focused on renewables rather than nuclear power; it remains to be seen if the company will fully bear the cost of the potentially dangerous decommissioning process.

Also, in a report on electric utilities published earlier this year by Ceres and Clean Edge, Entergy ranked at or near the bottom of US-based utilities in renewable energy sales and annual energy efficiency.

The DJSI also lists sustainability leaders for 24 industry groups, and there too my Vermont experience
had me wondering about the basis for inclusion. Ranked as the leading sustainable corporation in the Consumer Services group was Sodexo, whose employees provide food services for several of the state's colleges. In 2013, the French company announced a change in how it determined full-time employment, leading to a loss of benefits for many of its employees.

“They were clearly making a legal decision that was designed to fatten their bottom line at the expense of their workers,” State Senator Philip Baruth told VTDigger. After an outcry, Sodexo announced in June a reversal of its decision.

Also listed on the DJSI is the heavy equipment manufacturer Caterpillar. A recent report by the Tel Aviv-based research organization Who Profits found that the company and other heavy equipment manufacturers were complicit in such occupation tactics by Israel as house demolitions; military use of engineering tools; construction of illegal settlements; and construction of the wall and checkpoints.

Overall, 53 companies headquartered in the US were included in the DJSI World Index this year.

 

 
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