Investor sustainability initiative Climate Action 100+ announced today some of the key shareholder resolutions filed by its members for the 2021 proxy season, focusing on corporate governance on climate change, emissions target setting, and disclosure of business plans aligning with the transition to a net zero emissions future.
Climate Action 100+ is an investor initiative, with over 545 investors representing more than $52 trillion in assets, that targets the world’s largest corporate greenhouse gas emitters to promote taking necessary action on climate change, and align their business strategies with net zero in order to help limit average global temperature rise to 1.5 degrees Celsius. Signatories to the initiative engage with companies to ensure they implement a strong governance framework that takes into account climate risks and opportunities, reduce emissions across the value chain, and increase climate-related financial disclosures.
In September 2020, Climate Action 100+ announced the launch of a new Net-Zero Company Benchmark that it will use to evaluate company action and ambition demonstrated in tackling climate change. The group stated that investors are filing shareholder resolutions and focusing on board governance at companies that lag on key benchmark indicators.
Mindy Lubber, sustainable investor network Ceres’ CEO and President and Climate Action 100+ Steering Committee member, said:
“Proxy resolutions and routine votes, considered by all shareholders at corporate annual meetings, are an increasingly important tool for investors to protect value and reduce systemic risk in a world in which the climate crisis is an ever greater danger.
“Investors are sending a clear message to companies about the urgency of acting on the climate crisis in time to protect themselves, their clients and employees, and the global economy and planet.”
The group stated that its members have filed 37 shareholder proposals at North American focus companies seeking disclosure of climate-related risks, alignment of business plans with the goals of the Paris Agreement, and transparency around corporate lobbying practices that influence climate and energy regulations. Some of the key proposals flagged by Climate Action 100+ include:
- TCFD reporting: Filed at Berkshire Hathaway, by Caisse de depot et placement de Quebec (CDPQ), CalPERS and Hermes, seeking Task Force on Climate-related Financial Disclosures (TCFD)-aligned reports on physical, transitional and other financial risks the company faces in its transition to net zero emissions.
- Paris-aligned lobbying: Filed at ExxonMobil by BNP Paribas Asset Management, at General Motors by New York City Office of the Comptroller, and at Phillips66 by California State Teachers’ Retirement System, asking for disclosure of the companies’ climate lobbying practices.
- Climate Action 100+ Net Zero Company Benchmark: Filed at General Electric by As You Sow, asking for a progress report against the benchmark’s indicators including short, medium and long-term greenhouse gas emission reduction targets.
Anne Simpson, Managing Investment Director, Board Governance and Sustainability at California Public Employees Retirement System (CALPERS) and Climate Action 100+ Steering Committee member, said:
“The 2021 proxy season is vitally important to investors who are looking for companies to respond positively to the goals of Climate Action 100+. Corporate governance of climate change is critical as board accountability holds the key to the net zero transition. we are not looking for a change of heart, but a change of strategy. this requires corporate boards to be held accountable for their stewardship of investors’ capital to ensure sustainable value creation for our pension fund members.”