Big Banks Targeted with Shareholder Resolutions Demanding Fossil Fuel Financing Phase-out, Climate Transition Plans
A group of sustainability-focused shareholder and advocacy groups announced a series of climate-focused shareholder resolutions at several major Wall Street banks today, asking the banks to provide visibility on their plans to achieve their climate goals, and to commit to a timeline to phase out fossil fuel financing.
One of the resolutions, filed by shareholder advocacy group As You Sow at Bank of America, Goldman Sachs, JPMorgan Chase, Morgan Stanley, and Wells Fargo, asks the banks to disclose climate transition plans for achieving their 2030 net-zero aligned financed emissions reduction goals.
The banks are all members of the Net-Zero Banking Alliance (NZBA), and each has already set 2030 goals for either absolute emissions or emissions intensity reductions for financing activities in key carbon-intensive sectors. According to As You Sow, the resolution aims to help the banks assure investors that they have a path towards meeting their 2030 pledges. The resolutions include requests for specific measures and policies to be implemented by the banks, the reductions to be achieved, and for timelines for implementation and associated emission reductions.
Danielle Fugere, President of As You Sow, said:
“It is critical that U.S. banks be clear with investors about how they intend to meet their 2030 goals. While public policy, technology, green funding, and client progress all have a role to play in accomplishing these goals, banks must affirmatively acknowledge that every decision they make has climate implications. Owning that space and disclosing how they are working to deliver on their net-zero goals creates accountability and clarity on the path to net zero.”
Another proposal, filed by Harrington Investments, Trillium AM, and The Sierra Club Foundation at Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, and Wells Fargo asked each of the banks to commit to a time-bound phase-out of new fossil fuel exploration and development.
While the fossil fuel proposal is similar to one filed last year, the new resolution clarifies that the request is for a policy to phase out the financing of new fossil fuel exploration and development, following claims by some of the banks last year that the proposals called for an abrupt end to client relationships. Last year’s resolutions received only between 8% – 13% support.
Paul Rissman of the Sierra Club Foundation said:
“The banks’ objection to the language of last year’s proposal was that it would cut off clients immediately and prevent banks from financing the net-zero transition, insofar as they couldn’t support companies that may have low-carbon transition plans but are still involved in oil and gas development. This year’s proposal encourages banks to finance companies that are certified by a credible third party to be on a net zero pathway while maintaining that financing for new fossil fuels is incompatible with the banks’ climate commitments.”