Two complementary Masterclasses on stakeholder dialogue for sustainable finance were held on October 12 and November 9 with the members of the “+1 ecology turned into actions” collective. The first was a raising-awareness Masterclass attended by Anne-Catherine Husson-Traoré, CEO of Novethic, Philippe Hermann, Director of Sustainable Finance at Veolia, and Elouan Heurard, ESG Climate and Biodiversity Analyst at Candriam, an asset management company. The second was an experimentation in order to compare stakeholder’s viewpoints on the contribution of stakeholder dialogue to sustainable finance. The aim of those twoe Masterclasses is to foster knowledge sharing and stakeholder cooperation.
1st Masterclass: what is sustainable finance?
Sustainable finance, as defined by the French Financial Markets’ Authority (AMF), refers to practices that take extra-financial criteria into account, in addition to financial criteria, in the analysis, selection and management of investments. It is also presented as "an indispensable lever for meeting the ecological and economic challenges of our time".
Incorporating environmental, social and governance (ESG) criteria into financial practices is now essential. For several years now, finance has been transforming itself in response to climate change and its consequences for the planet. Reducing greenhouse gas emissions and respecting planetary limits are becoming crucial factors in sustainable finance.
Anne-Catherine Husson-Traoré, Managing Director of Novethic:
At a time when environmental risks are becoming tangible and overturning existing business models, companies need to be aware of the need to transform their business models. Investors are interested in and value companies like Veolia that take these parameters into account and are moving towards more sustainable finance.
Philippe Hermann, Veolia's Director of Sustainable Finance:
At Veolia, we have put finance and the company's extra-financial performance - environmental, social and governance (ESG) - on the same level, starting in 2020. This is the first step in sustainable finance that no longer dissociates financial and extra-financial criteria. This is what we call plural performance. Through taxonomy, we are increasingly developing concrete action plans to accelerate the preservation of biodiversity and thus speed up ecological transformation
Elouan Heurard, ESG Climate and Biodiversity Analyst at Candriam:
When we talk about sustainable finance, we need to be sure we have our priorities in the right place. You have to set a framework: avoid, then reduce, then regenerate and restore if it wasn't possible to avoid. In the discussion with the company, this must happen in this order with this level of importance. We can also (in the ESG analysis) add stakeholders we wouldn't have thought of initially, depending on the framework in which the company operates.
Watch the full +1 Masterclass on video
2nd Masterclass: what does stakeholder dialogue contribute to sustainable finance?
The European Union has recently stepped up non-financial reporting requirements for companies. The European Corporate Sustainability Reporting Directive (CSRD), which will come into force gradually starting in January 2024, requires companies to publish more environmental, social and governance (ESG) data, enabling them to assess their impact on the ecosystem and, conversely, the impact of environmental factors on their activities. This is what the directive refers to as “double materiality”.
Within this framework, dialogue with stakeholders takes on its full meaning and place, as the CSRD explicitly states that “stakeholders are to be questioned and taken into account in the company’s materiality”, says Philippe Hermann.
At the +1 Masterclass, held on November 9, 2023, the members of the +1 collective, with their different backgrounds, compared their viewpoints on the contribution of stakeholder dialogue to sustainable finance.
Laurène Chenevat, Sustainable Finance Policy and Regulation Leader, Green and Sustainable Hub, Natixis:
Stakeholder dialogue boosts the exhaustiveness of [non-financial] reporting on the risks, opportunities and impacts [inherent to a company’s business activity]. It helps to fully understand sustainability challenges across the board throughout the company's value chain and produce a comprehensive sustainability analysis specific to the company based on its materiality analysis. As no two companies are alike, it would be utopian to expect exactly comparable data. But for some data and issues, dialogue between peers, comparing what other companies in the same sector are doing, serves to deepen understanding on where a company stands in terms of the performance and management of sustainability issues. For example, dialogue on methodological transparency helps to dispel any misunderstandings with external stakeholders.
Olivier Eugène, Head of Climate, ESG Research, AXA Investment Managers
Stakeholder dialogue serves to explain data by putting them into perspective. It can also help to illuminate blind spots and identify topics that we don’t think about when sitting in front of our screens reading PDF, Word and Excel documents. Dialogue opens our eyes.
Cristian Mocanu, General Secretary, COFICERT
Dialogue between stakeholders is vital because it helps us to understand the ins and outs of a company’s reporting system and ensure that the scope and methodology used are comprehensible to everyone. Dialogue also serves to forge a global view of a sector or community through a macro approach that helps us steer clear of biases or prejudices relative to a single entity. We are thus able to see the impacts of our activity across the entire value chain and better address the issues, to the benefit of people and the environment.
The November 9 Masterclass also served to establish two key focuses. The first is that companies should report “less but better” by selecting the most important information and explaining it to all stakeholders. The second is the need to make non-financial communication as attractive and clear as possible so that all the players involved understand the reporting data and can take informed action.
+1, a unique mechanism for dialogue and cooperation between stakeholders
In response to the ecological imperatives we face, Veolia is continuing and strengthening its "+1 for an ecology in action" stakeholder dialogue program.
Developed by Veolia, in partnership with Usbek & Rica and la REcyclerie, and supported by Comité 21, the "+1, for an ecology in action" scheme is a consultation mechanism that mobilizes some fifty Veolia stakeholders from different backgrounds, (Employees, Customers, Shareholders,..), and aims to find a common path to serve the ecological transformation.
Initiated in 2021, this shared progress approach, with and for all the Group's stakeholders, reflects a desire to build new interfaces with society and enable companies to be useful and prosperous within their stakeholder ecosystems.
Through its purpose, the Group aims to reconcile the economy, the environment and society, thereby producing a positive and lasting impact.
Fields of application
This consultation prototype can be transposed to different contexts, geographical areas and subjects. The +1 method was shared in open source in April 2023, enabling all willing stakeholders, inside and outside Veolia, to appropriate the approach to accelerate ecological transformation.
This approach is also taking its first steps within a contract (Arianeo for Métropole Nice Côte d'Azur) and is now being deployed as part of the development of Veolia's new 2024-2027 strategic program.
Why is dialogue with stakeholders essential?
The +1 collective wants to think about tomorrow's more sustainable and desirable world. Rethinking our models with all our stakeholders, by integrating the various levers of ecological transformation, is at the heart of our thinking. To achieve this, everyone has a role to play, and all our stakeholders are concerned by these social challenges. Cooperation between stakeholders thus takes on its full meaning.
It is in this sense that Veolia contributes every day to working towards an ecological future. Through dialogue and reflection between stakeholders from different horizons and with sometimes divergent interests, the +1 initiative opens its doors to its stakeholders to work with them in a decompartmentalized way and imagine together solutions useful to the greatest number.
A number of success indicators can be used to evaluate the approach: member participation in workshops, degree of satisfaction at each stage, etc. During the first trial of the system, 93% of respondents felt that the objective of working better together with a variety of profiles had been achieved. Other indicators are currently being developed.
Key figures for +1
"+1" schemes initiated since 2021
countries involved : Australia, Japan, UK, Czech Republic, Colombia, USA, France, Italy
- Read a summary of the discussions at our 1st +1 Masterclass on June 15, 2023 on cooperation and innovation as gas pedals of ecological transformation.
- And on sustainable finance: Institut Veolia meeting with Anne-Catherine Husson-Traore, Managing Director of Novethic.