{"id":257138,"date":"2023-05-12T20:30:45","date_gmt":"2023-05-12T18:30:45","guid":{"rendered":"https:\/\/climatescience.press\/?p=257138"},"modified":"2023-05-12T20:30:48","modified_gmt":"2023-05-12T18:30:48","slug":"esg-battle-over-italian-energy-giant","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=257138","title":{"rendered":"ESG Battle Over Italian Energy\u00a0Giant"},"content":{"rendered":"\n
\"\"
FILE PHOTO: A logo of Italian multinational energy company Enel is seen at the Milan headquarters, Italy, February 5, 2020. REUTERS\/Flavio Lo Scalzo\/File Photo<\/figcaption><\/figure>\n\n\n\n

<\/p>\n\n\n\n

From Science Matters<\/a><\/p>\n\n\n\n

By\u00a0Ron Clutz<\/a><\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Enel, Italy\u2019s largest energy utility is in the news with conflict over appointing a new CEO because  aspirations differ between ESG investors and the Italian government.   There are headlines like these:<\/p>\n\n\n\n

Norway\u2019s oil fund rejects Rome\u2019s candidate for Enel chair, Financial Times<\/strong><\/p>\n\n\n\n

Wanted! Investors demand Italy hire renewable expert, global networker to run Enel, Zawya<\/strong><\/p>\n\n\n\n

Government board nominations for Enel run into opposition, msn<\/strong><\/p>\n\n\n\n

Enel confirms 2023 guidance, enters press blackout on nominations<\/strong><\/a>, Reuters<\/strong><\/p>\n\n\n\n

MILAN (Reuters) \u2013 Italy\u2019s biggest utility, Enel,<\/strong> confirmed its full-year guidance and entered a press blackout period ahead of a May 10 shareholder vote on a challenged board shake-up.<\/strong><\/em><\/p>\n\n\n\n

The group, whose main shareholder is Italy\u2019s Treasury with nearly a 24%-stake,<\/strong> is at the centre of a governance row that will be decided at the AGM scheduled for next Wednesday.<\/em><\/p>\n\n\n\n

The Treasury has proposed a new management, putting forward a slate of six new candidates and ousting current Enel CEO Francesco Starace, who has been at the helm since 2014.<\/strong><\/em><\/p>\n\n\n\n

Hedge fund Covalis<\/strong>, which holds around 1%<\/strong> in Enel, presented an alternative list of nominees,<\/strong> criticising the process under which the government picked its candidates.  Covalis said the system that led to the government\u2019s nominations \u201cundermines investor confidence, erodes value and is out of line with international standards of best practice in shareholder democracy\u201d<\/em>.[Would those best practices be ESG?]<\/p>\n\n\n\n

Proxy adviser Frontis Governance<\/strong> has urged shareholders to back the candidates promoted by Covalis and reject names put forward by the Treasury, in a report tailored for Switzerland\u2019s Ethos, a group of pension funds and other investors.<\/em><\/p>\n\n\n\n

On the financial side,<\/strong> Enel\u2019s ordinary earnings<\/strong> before interest, taxes, depreciation and amortization (EBITDA) in the first quarter rose<\/strong> 22% to 5.5 billion euros above an analyst consensus of 5.4 billion euros.  Net debt<\/strong> at the end of March was 58.9 billion euros, down<\/strong> from 60.1 billion euros at the end of last year.<\/em><\/p>\n\n\n\n

Starace described the results in the first three months of 2023 as outstanding and said the group had already exceeded half<\/strong> of<\/strong> its 21 billion euro ($23 billion) asset sale target<\/strong> unveiled last November.<\/em><\/p>\n\n\n\n

The state-controlled group intends to focus<\/strong> its business on the core markets<\/strong> of Italy, Spain, the United States, Brazil, Chile and Colombia.<\/em><\/p>\n\n\n\n

Wanted! Investors demand Italy hire renewable expert, global networker to run Enel,  <\/strong><\/a>Zawya<\/strong><\/p>\n\n\n\n

Expertise in renewables and an international focus are what investors want<\/strong> to see from a new head of state-controlled Enel, as Italy\u2019s government screens candidates to replace the energy group\u2019s long-serving chief executive.<\/em><\/p>\n\n\n\n

Prime Minister Giorgia Meloni\u2019s administration is determined to oust current CEO Francesco Starace, several sources told Reuters. In charge since 2014, Starace<\/strong> is in the crosshairs of Meloni\u2019s inner circle as he is deemed too independent.<\/strong><\/em><\/p>\n\n\n\n

Meloni\u2019s office is also concerned about the group\u2019s debt pile. But sources familiar with the matter said that head hunters hired by the Treasury are finding it tricky to put forward potential successors with the broad range of skills required to run one of Europe\u2019s largest utilities.<\/strong><\/em><\/p>\n\n\n\n

With almost 60 Gigawatt of installed capacity, Enel is one
of the world\u2019s biggest players in renewable energy<\/mark><\/strong><\/em><\/p>\n\n\n\n

Starace won plaudits for his commitment to green energy.<\/strong> However, investors and the government grew restless over a debt pile<\/strong> that had grown<\/strong> to around 60 billion euros ($65.40 billion) in 2022 from 45.5 billion in 2020, when Starace was reappointed for a third term.<\/em><\/p>\n\n\n\n

The company, which has been hit by soaring gas prices and government measures capping bills to shield consumers,<\/strong> saw net profit slip to 5.4 billion euros last year, from 5.6 billion euros in 2021.<\/em><\/p>\n\n\n\n

The new CEO should not sacrifice the group\u2019s exposure to North America and confirm its dividend policy, a number of investors said.<\/strong><\/em><\/p>\n\n\n\n

\u201cPeople in Italy may prefer that Enel focuses on<\/strong> making things as much as possible in its home country<\/strong> and not investing so much abroad, but the company has no choice\u2026 if it wants to attract foreign investors,<\/strong>\u201d said Vincent McEntegart, multi-asset investment manager at Aegon Asset Management,<\/strong> an Enel shareholder with assets under management worth $311 billion.<\/em><\/p>\n\n\n\n

For Enel, U.S. President Joe Biden\u2019s green energy subsidy package could mean double digit returns in North America<\/strong> compared with single digit in Europe, McEntegart said, adding such returns would underpin the group\u2019s attractive dividend policy.<\/em><\/p>\n\n\n\n

Since Starace was appointed CEO in May 2014, Enel has increased its
installed renewable energy capacity to 59 GW from 36 GW at the end of 2013.<\/mark><\/strong><\/em><\/p>\n\n\n\n

Starace\u2019s mantra has been electrification of consumption and digitalisation of grids<\/strong> and he said last year he wanted to leverage a renewed focus on energy security around the world to accelerate the group\u2019s exit from natural gas. The group currently plans to become carbon free in 2040.<\/strong><\/em><\/p>\n\n\n\n

\u201cMy priorities for the new CEO would be to continue to roll out renewables and accelerate the exit from gas,<\/strong>\u201d Simone Siliani, the director for Italy\u2019s Fondazione Finanza Etica, told Reuters.  Finanza Etica,<\/strong> which is an active investor on ESG issues,<\/strong> has been holding a tiny stake in Enel<\/strong> since 2008.<\/em><\/p>\n\n\n\n

\u201cEnel can make the difference if Italy wants to meet its decarbonisation goals,\u201d<\/strong> added Siliani.<\/em><\/p>\n\n\n\n

Summary: <\/strong><\/p>\n\n\n\n

Once again we have climatist financiers using ESG to push zero carbon against the mission of providing secure and affordable energy that citizens need.<\/p>\n","protected":false},"excerpt":{"rendered":"

Once again we have climatist financiers using ESG to push zero carbon against the mission of providing secure and affordable energy that citizens need.<\/p>\n","protected":false},"author":121246920,"featured_media":257141,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","_crdt_document":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[1],"tags":[691819512,691818229,691819511],"class_list":{"0":"post-257138","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","6":"hentry","7":"category-uncategorized","8":"tag-enel","9":"tag-esg","10":"tag-italian-government","12":"fallback-thumbnail"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/05\/0Enel-Italy-energy-utility-1200x800-1.jpg?fit=1200%2C800&ssl=1","jetpack_likes_enabled":true,"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/paxLW1-14To","jetpack-related-posts":[{"id":359281,"url":"https:\/\/climatescience.press\/?p=359281","url_meta":{"origin":257138,"position":0},"title":"European Energy Firm Ordered to Remove 84 Wind Turbines from Osage Lands in Oklahoma","author":"uwe.roland.gross","date":"28\/12\/2024","format":false,"excerpt":"Energy Expert Robert Bryce: \u201cIt is a colossal black eye for the wind industry, which has collected tens of billions of dollars in federal tax credits by claiming its landscape-blighting, bird-and-bat-killing, property-value-destroying turbines are an essential part of the effort to avert catastrophic climate change.\u201d","rel":"","context":"In \"Climate change\"","block_context":{"text":"Climate change","link":"https:\/\/climatescience.press\/?tag=climate-change"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/12\/0images.wsj_.jpg?fit=1200%2C616&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/12\/0images.wsj_.jpg?fit=1200%2C616&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/12\/0images.wsj_.jpg?fit=1200%2C616&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/12\/0images.wsj_.jpg?fit=1200%2C616&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/12\/0images.wsj_.jpg?fit=1200%2C616&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":292542,"url":"https:\/\/climatescience.press\/?p=292542","url_meta":{"origin":257138,"position":1},"title":"Federal Judge Sides with Osage Nation, Orders Removal Of 84 Wind Turbines","author":"uwe.roland.gross","date":"24\/12\/2023","format":false,"excerpt":"The Osage Nation won a massive ruling in Tulsa federal court on Wednesday that requires Enel to dismantle a 150-megawatt wind project it built in Osage County despite the tribe\u2019s repeated objections. 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