Historic year for green investors

28 August 2009

Sarah Wilson

EU regulation

Investors engaging with North American companies on climate change financial risks achieved major breakthroughs in the 2009 proxy season according to a recent report by environmental think-tank, CERES.

A record 68 climate-related shareholder resolutions were filed by investors this year. Of the 68 resolutions filed, a record 31 resulted in company agreements and withdrawal of the resolutions. Twenty-eight resolutions went to a vote at this year’s corporate annual meetings; six resolutions were omitted by the SEC and three failed to reach a vote for technical reasons.

Six of the 28 resolutions that went to a vote achieved 30 percent or greater support, including one filed with coal company Massey Energy that received 45.6 percent support, or $458.1 million in shares. The resolutions were filed by state and city pension funds, foundations, and religious, labor and other institutional shareholders which collectively manage more than $300 billion in assets.

The 2009 global warming resolutions sought increased energy efficiency, as an important driver of bottom-line savings for companies; GHG emissions reductions; and greater disclosure from companies on their strategies for addressing climate-related risks and opportunities. The resolutions were filed by state and city pension funds, foundations, and religious, labor and other institutional shareholders. The filers collectively manage more than $300 billion in assets.

According to CERES, a coalition of investors and environmental groups that helped coordinate this year’s shareholder filings along with the Interfaith Center on Corporate Responsibility (ICCR), the key highlights of the 2009 proxy included:

  • Following a 51.2 percent majority vote in May, IDACORP agreed to adopt GHG reduction goals by year’s end, issued its first RFP (request for proposal) for a wind farm and submitted a smart grid proposal to utility regulators;
  • Chevron, which investors had placed on a Climate Watch List last spring, agreed in May to develop and disclose a business plan setting an annual GHG emissions reduction target for its operations, and to track emissions from its products;
  • NV Energy (formerly Sierra Pacific Resources), after agreeing to provide expanded disclosure of its strategy to address climate change, announced it would increase its renewable energy generation and abandon a 1,500-megawatt coal plant;
  • Citigroup agreed to establish a due diligence process for mountain top removal (MTR) coal mining related loans and to consider shareholder input in the development of that process; and
  • Pulte, the nation’s largest homebuilder, agreed to establish quantitative emissions reduction goals for its operations.

“Investor pressure is prompting more companies to see the value of making their businesses more climate-friendly,” said Mindy S. Lubber, president of CERES.  “By measuring and lowering the carbon footprint of their operations and products, these companies will have a distinct advantage as the global economy shifts to cleaner energy sources.”

Investors also filed resolutions with 27 companies asking them to provide company-specific sustainability reports detailing how they are managing environmental, social, and governance (ESG) issues beyond climate change. Overall this proxy season, more than a dozen North American companies have committed to producing a first-time sustainability report.

Links

 Highlights from the 2009 Climate Change Proxy Season

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