Blog SRI Post

Increasing numbers of investors are successfully engaging in dialogue with companies on the risks of climate change. When engagement is unsuccessful, some investors are filing shareholder proposals to be voted on at company annual meetings.

Very few investors attend the annual stockholder meetings of the companies in which they hold shares. Most investors who want their voices heard in the company board room vote their proxies. Any shareholder that meets certain requirements can place a shareholder resolution on a company ballot to raise awareness about a particular issue among a wider base of the company’s shareholders.

The 2010 proxy season has seen a record 95 climate-related shareholder proposals filed by investors at 82 U.S. and Canadian companies. According to the Investor Network on Climate Risk, this represents a 40% increase over the number of climate-related resolutions filed last year and demonstrates the increasing concern investors have about climate related risks to their investments.

First Affirmative co-filed five of the resolutions on the list, including resolutions requesting that RR Donnelley adopt a sustainable paper purchasing policy, that Aqua America produce a sustainability report, that Kroger assess and manage climate risks to its supply chain, and that JPMorgan Chase review its implementation of the Carbon Principles. (The resolution filed at JPMorgan Chase has been withdrawn following successful negotiations.) First Affirmative also co-filed a resolution filed by the California State Teachers’ Retirement System (CalSTRS) at ConocoPhillips requesting a report on the environmental damage that would result from expanding oil sands operations in Alberta, Canada’s boreal forest.

In January of this year, the Securities and Exchange Commission (SEC) issued interpretive guidance for companies on what they should report related to climate risks and opportunities. This SEC guidance reflects a growing recognition that climate change may pose significant business risks for many corporations and significant opportunities for others. Most importantly, the SEC is acknowledging that investors need to know about climate related risks and opportunities.

In early March, 56 treasurers, comptrollers, controllers, institutional investors, and asset managers representing $2.1 trillion in assets, sent a letter to the SEC showing their strong support of the Commission’s new guidance. Read more about the SEC guidance on First Affirmative’s blog, or read the official document.

Note: Mention of specific companies or securities in this blog should not be considered a recommendation to either buy or sell that security. For information regarding the suitability of any security for your investment portfolio please contact your financial advisor.

Christie Renner
First Affirmative Financial Network
christierenner@firstaffirmative.com

This entry was posted on Monday, April 12th, 2010 at 8:16 am Both comments and pings are currently closed.