– According to a report from Reuters (paywall), investment funds with ESG goals appear to be back in vogue in 2023, although the banking crisis that roiled markets last month removed some of the shine as investors withdrew cash toward the end of the quarter. The previously booming ESG investment industry experienced a rough 2022, as soaring energy prices and a surge in global inflation eroded confidence in sustainable investing for some. Before concerns over the health of banks sparked an investor rush to safety, funds marketing themselves as ESG-friendly had a strong start to 2023, with investors adding in more cash than they withdrew. Across ESG debt, equity and multi-asset funds, net inflows hit $25.5 bn, the best quarter since early 2022.
– Al Monitor reported that TotalEnergies confirmed it will make an initial investment of $10 bn in three Iraqi oil fields and develop a solar energy plant to supply the Basrah regional grid in the south of the country, as part of a $25 bn deal with Iraq’s government and QatarEnergy. Reports emerged earlier this week that the French energy giant had struck a deal with the Iraqi government to work on the energy project, with the state taking a 30 percent stake. The Iraqi government originally wanted a 40 percent stake in the project, which ended up stalling due to a dispute over the terms of the deal.
– Meanwhile, the Financial Times (paywall) wrote that a prominent activist group and 17 other investors filed a shareholder resolution calling on TotalEnergies to do more to cut its emissions by 2030, a move that would imply rolling back some of its gas projects and investing more aggressively in renewable energy. TotalEnergies defended its stance, saying it was keeping this goal while increasing its energy production and was pivoting more toward gas, a fuel that was replacing more polluting coal in the world.
– Several big investors joined opposition to an ambitious stock market overhaul proposed by US regulators to improve transparency and pricing for smaller retail traders, the FT reported.
The criticisms point to deep concern about elements of plans published in December by the SEC and promoted by chair Gary Gensler, which amount to the biggest reform of equity trading in two decades. The regulator’s focus on the innards of stock trading follows the explosion in consumer interest during pandemic lockdowns that produced the 2021 ‘meme stock’ frenzy, which collapsed in acrimony after overwhelmed brokers limited trading in several companies. The SEC’s proposals to increase the amount of data brokers publish and to shrink trading increments has gathered some support, albeit with suggested changes.
– Bloomberg (paywall) reported that the money exchange firm Al Ansari Financial Services rose in its trading debut, as Dubai’s first IPO this year further signaled the Middle East’s emergence as a bright spot for share sales. Shares of Al Ansari were 19 percent higher at 1.23 dirhams ($0.33) in early trading. The stock had priced at 1.03 dirhams per share, at the top end of the marketed IPO range, which valued the firm at around $2.1 bn. The Middle East has seen continued appetite for offerings at a time when recession concerns, high inflation and interest rate hikes by central banks have dampened investor sentiment in the global IPO market.
– In Asian markets, Nomura defended its title as the number one corporate access provider in Japan, reported Institutional Investor, based on feedback from 184 investors at 132 firms. Respondents were asked to consider five attributes – conferences, logistics, field trips, team quality, roadshows and virtual events – and Nomura came first in three out of five. Runner-up Daiwa Securities Group was recognized for field trips and roadshows. Following Dawia on the overall leaderboard were SMBC Nikko Securities and Mizuho Securities, which placed third and fourth, respectively. Mitsubishi UFJ Morgan Stanley rounded out the top five. Regardless of how it is delivered, institutional investors continue to value high-quality engagement with corporate managements and seek regular communication with corporate investor relations, according to Daisuke Suzuki, head of Asia-Pacific equity sales and corporate access at Mizuho.
– In crypto news, Justin Sun’s biggest lesson from his mentor, Alibaba Group founder Jack Ma, was how to use shared values to scale up a company quickly and manage larger and larger numbers of employees, Al Jazeera reported. ‘We learned a lot from Alibaba and Jack Ma about trying to adapt our business,’ Sun, the founder of global cryptocurrency network Tron, told Al Jazeera. He established a relationship with Ma at the Alibaba founder’s elite business school in Hangzhou and in 2017 completed his company’s initial coin offering, raising $70 mn, just days before China banned such fund-raisers and shut down all local cryptocurrency exchanges.
Since then, Beijing has sought to assure firms that it intends to ease its grip on tech firms as it seeks to revive the economy following the end of its crippling zero-Covid strategy.
Guo Shuqing, a high-ranking central bank official and financial regulator, said in January that the tech crackdown, which has wiped around $1 tn off the market value of the sector, was ‘basically’ over and private firms would be encouraged to ‘come out strongly in leading economic growth, creating more jobs and competing globally’.