The business risk of voting against climate change proposals

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The business risk of voting against climate change proposals

Shareholder proposals to support policies around climate change mitigation have had some recent wins that deserve celebrating.

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In April, Equinor agreed to make strengthened commitments on climate change, following engagement with Climate Action 100+, an initiative created by investor and shareholder groups to work with 100 of the world’s largest emitters. Investor signatories led by UBS Asset Management, HSBC Asset Management and Storebrand Asset Management engaged with Equinor.

In May, BP’s shareholders voted to require the oil and gas company to disclose how its strategy matches the goals of the Paris climate agreement. And we have also seen Shell announce Scope 3 greenhouse gas intensity reduction goals, Total has invested substantially in solar energy, and Danish company Orsted has sold its oil and gas portfolio.

But against the positive changes, still some companies and shareholders are dragging their feet. Last month the majority of shareholders in ExxonMobil and Chevron voted against climate resolutions, for example. While the voting was largely heralded a success – a third of Chevron’s shareholders supported a resolution asking the company to report on how it plans to reduce its full range of greenhouse gas emissions and transition its business model to align with a decarbonizing energy market – it means yet another year will roll by for the remainder of shareholders to get on board.

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