Climate in the Boardroom: How Asset Manager Voting Shaped Corporate Climate Action in 2019
Large investors have the power to hold energy and utility companies accountable to undertaking the urgent transformations that our climate crisis demands. But while some top investment managers are leading the way, BlackRock and Vanguard persist in using their shareholder voting power to shield corporate boards from accountability. This report reviews the 2019 voting patterns of the 25 largest global asset managers on director elections, executive pay, and critical climate shareholder proposals and offers recommendations for asset owners and policymakers alike. Read the report
Net-Zero By 2050: Investor risks and opportunities in the context of deep decarbonization of electricity generation
In recent years, institutional investors worldwide have won substantial advances in corporate disclosures and engagement on climate change. Companies across a range of industries have set emissions reductions targets, undertaken scenario planning, and made meaningful disclosures of climate-related risks. Moreover, despite the Trump Administration’s announced plan to withdraw from the 2015 Paris Agreement, investors joined with mayors, governors, and business leaders across the United States in the "We Are Still In" coalition, re-doubling their commitment to meeting the agreement's goals of keeping warming to well below 2°C above pre-industrial levels, and pursuing efforts to limit warming to 1.5°C. Read the Report
Asset Manager Climate scorecard 2018
The accelerating climate crisis is making the transition to a low-carbon economy urgent. Increasingly, investors and other stakeholders are asking corporate leaders to decarbonize their business models and to exercise their political influence in support of a clean economy. While some progress in these directions is being made, research from CERES, Carbon Tracker, the 50/50 Climate Project and others has shown that business model transformation is proceeding unevenly in both the oil and gas and utilities industries. High carbon-emitting industries continue to exert extensive political influence in support of the status quo, executives remain incentivized to maximize fossil fuel utilization, and boards lack the experience with and knowledge of climate science and renewables needed to achieve business model innovation. Read the report
Proxy voting conflicts: Asset Manager Conflicts of Interest in the Energy and Utility Industries
All investors have choices about how to invest their financial resources, and most investors share the goal of aligning their investments with their long-term goals and interests. Moreover, investors generally expect that the fund managers they select to steward their investments are proactively encouraging the companies in their portfolios to address the spectrum of risks associated with their businesses, including environmental, social, and governance risks. However, many of the largest fund managers in the U.S. have failed to exercise their proxy voting responsibilities to address these concerns. Read the report
Spending Against Change: Key Metrics Assessment of Climate Change Governance and Political Influence Spending in the Energy and Utility Sectors
Twenty-one of the biggest energy and utility companies in the United States have minimal board oversight of climate risk and almost no board members with relevant climate-related expertise. These companies spent $673 million dollars over six years to influence the political system, predominantly with shareholder money. Companies directed three-quarters of the spending to lobbying, but only six of the 21 corporations voluntarily disclose these expenditures to their investors.
One of the most significant issues confronting organizations today relates to the risks associated with climate change. While it is widely recognized that continued greenhouse gas emissions will cause further atmospheric warming, and this warming is expected to lead to damaging economic and social consequences, the exact timing and severity of physical effects are difficult to estimate. The scale and time horizon of the problem make it uniquely challenging. Many organizations and their shareholders incorrectly perceive climate change implications to be strictly long term and, therefore, not especially relevant to decisions made today.
The Key Climate Vote Survey (KCVS) is a resource for institutional investors seeking to better manage climate risk in their investment portfolios and ascertain how their investment managers are addressing this risk and promoting boardroom climate competence in their firm-wide proxy voting activities. The KCVS seeks to identify the most consequential 2017 votes on climate business risk shareholder resolutions and management proposals to elect directors and approve executive compensation. The KCVS then analyzes the publicly disclosed voting records of the largest global investment managers on these key proposals. The following report provides an indication of how effectively the largest financial management firms, through proxy voting, are overseeing investments, on behalf of long term asset owners, in the oil and gas and utility sector portfolio companies with the largest carbon footprints and greatest vulnerability to climate risks.