Activist Investors Claim Record Results on Climate Change
by Michael Connor
Investors filed a record 101 climate and energy-related resolutions with 88 U.S. and Canadian companies in 2010, a 50% increase from the year-earlier, according to activist shareholder organizations.
Sixteen of the 42 resolutions that went to a vote achieved 30 percent or greater support, nearly three times the number that achieved that level of support in 2009. The average vote for the 42 resolutions voted on so far this year was 24.6 percent, up from 21.7 percent last year.
The statistics were compiled by Ceres, a coalition of investors and environmental groups, and the Interfaith Center on Corporate Responsibility (ICCR), a coalition of nearly 300 faith-based institutional investors.
”The BP spill is only the latest reminder of why investors are ratcheting up their attention to climate and other environmental risks across their portfolios,” said Mindy Lubber, president of Ceres. “This year’s record results send a powerful message that companies should boost their attention to these issues.”
“If our portfolio companies are to provide long-term shareowner value, they need to be proactive, not reactive, in addressing climate change and other ESG matters,” said Jack Ehnes, CEO of CalSTRS, the second largest pension fund in the U.S. Mr. Ehenes said the record results for shareholder filings in 2010 are “an encouraging sign that investors and companies are paying increasing attention to long-term drivers of value.”
Among the resolutions, requests for companies to provide a corporate responsibility or sustainability report have “increasingly resonated with investors,” according to Tim Smith, Senior Vice President for Walden Asset Management. He pointed to a record 60 percent vote at Layne Christensen and votes at Gentex and St. Jude in the low 30s and low 40s, respectively. “We believe this signals a tipping point for the case for transparency on CSR,” he said.
Correction 7/26: An earlier version of this story incorrectly reported the comments of Walden Asset Management’s Tim Smith in discussing vote results at Gentex.
The issues with key high votes and share value of votes in favor, according to Ceres and ICCR, were:
Adopt greenhouse gas (GHG) reduction goals:
CMS Energy, 35.1% ($729 million)
ExxonMobil, 27.2% ($39.7 billion)
Massey Energy, 53.1% ($852 million)
Ryland, 37.4% ($234 million)
Issue a sustainability report including GHG reduction strategies:
Boston Properties, 44.1% ($3.2 billion)
Chesapeake Energy, 31.5% ($2.4 billion)
EQT Corporation, 37.4% ($1.4 billion)
Federal Realty Investment Trust, 44.6% ($1.4 billion)
Layne Christensen, 60.3% ($234 million)
St. Jude Medical, 42.8% ($3.1 billion)
Report on the environmental and health risks associated with coal ash:
CMS Energy, 43.1% ($875 billion)
MDU Resources Group, 40.5% ($962 million)
The Southern Company, 21.0% ($2.6 billion)
Report on risks posed by the environmental, social and economic challenges associated with oil sands operations:
ConocoPhillips, 27.1% ($13.8 billion)
ExxonMobil, 26.4% ($38.3 billion)
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Tagged as: Boston Properties, BP, CalSTRS, Ceres, Chesapeake Energy, Climate Change, CMS Energy, ConocoPhillips, Environment, EQT Corporation, ExxonMobil, Federal Realty Investment Trust, Global Warming, Greenhouse Gas Emissions, ICCR, Interfaith Center on Corporate Responsibility, Jack Ehnes, Layne Christensen, Massey Energy, MDU Resources Group, Ryland, Socially Responsible Investing, St. Jude Medical, Sustainability, The Southern Company, Tim Smith, Walden Asset Management