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shareholder activism
Banks Accused of Placing 'Profit Over People and Our Planet' as Investor Climate Resolutions Fail
"Investors who voted against these resolutions should expect to have a hard time sleeping at night with the knowledge that their misplaced greed will lead to climate destruction and chaos," said one campaigner
Apr 25, 2023
Activists on Tuesday lamented their failure of various climate and Indigenous rights resolutions at the annual shareholder meetings of some of the nation's biggest banks, with one campaigner accusing the financial institutions of prioritizing "profit over people and our planet."
Just 10% of Citigroup shareholders and 7% of those owning Bank of America stock voted for resolutions urging banks to adopt a phaseout of financing for new fossil fuel projects. An unknown percentage of Wells Fargo shareholders voted for the resolution. Similar resolutions proposed last year garnered 13% of the vote at Citi and 11% at Bank of America and Wells Fargo.
Those three banks combined have financed nearly $1 trillion in fossil fuel projects since the Paris climate agreement was implemented in 2016, according to a report published earlier this month by a coalition of green groups.
\u201cToday, activist shareholders at 3 of the largest funders of fossil fuels in the world \u2014 @Citi @BankofAmerica & @WellsFargo \u2014 made resolutions for these banks to transition away from fossil fuel financing. Together they've contributed $1 TRILLION since 2016 https://t.co/QmNiLV4mIZ\u201d— Rainforest Action Network (RAN) (@Rainforest Action Network (RAN)) 1682455986
The resolutions were filed by Trillium Asset Management at Bank of America, Harrington Investments at Citigroup, and Sierra Club Foundation at Wells Fargo.
Nearly 30% of Bank of America shareholders also backed forcing the institution to release a 2030 climate transition plan, while 31% Citi investors endorsed a resolution requiring the company to publish a report on the effects of its policies and actions on Indigenous peoples' human rights.
As Sierra Club noted:
Investor filers made several amendments to the fossil fuel financing proposals at the banks this year, including asking banks to adopt a policy to phase out financing for projects and companies engaging in new fossil fuel exploration and development, which is incompatible with limiting global warming to 1.5°C, and encouraging banks to provide financing for energy sector clients to credibly transition to cleaner technologies, which could safeguard against greenwashing and accelerate the clean energy transition.
Tuesday's shareholder votes followed protests the previous day outside the headquarters of Bank of America in Charlotte, Citigroup in New York, and Wells Fargo in San Francisco. Dozens of activists slept overnight outside Citi's headquarters.
\u201cThank you to everyone showing up today! Shareholders need to know that everyone sees what a destructive climate force these banks are.\u201d— Bill McKibben (@Bill McKibben) 1682353417
"While... Citi shareholders continue to support evaluating its policies and impacts on Indigenous peoples, it's saddening and maddening to see the numbers drop a few points as our homelands are destroyed across the globe," said Tara Houska, a member of the Couchiching First Nation and founder of the Giniw Collective.
"These are not uninformed people, they are folks who hold an incredible amount of influence on social discourse and outcomes that impact all life," she added. "Hiding behind jargon and polite rooms are actions they choose as the world's finite freshwater is irreparably harmed."
Stephone M. Coward II, who runs the economic justice and Paid in Full campaigns at the Hip Hop Caucus, argued that "once again, these financial institutions prioritize profit over people and our planet."
"Pollution from fossil fuels worsens the effects of climate change, and together they create a destructive loop that disproportionately impacts the well-being of Black, Brown, and Indigenous people," Coward added. "We must continue to use all the financial levers of power to shift financial capital away from industries causing harm and toward communities that hold the solutions."
\u201cIt's time to escalate. For shareholders who care about Indigenous rights and our climate, it's time to consider divesting from fossil banks. They aren't changing and simply voting for non-binding resolutions ain't cutting it. \n\nTake your \ud83d\udcb0 out - the banks will start to listen.\u201d— Richard Brooks \u2600\ufe0f (@Richard Brooks \u2600\ufe0f) 1682446751
Jessye Waxman, the senior campaign representative for Sierra Club's Fossil-Free Finance campaign, said in a statement that "investors have once again failed to align their voting with their stated positions on climate-related financial risk."
"Stewardship is central to many investors' own net-zero commitments, so it's alarming that investors—including the biggest institutional investors like BlackRock and Vanguard—continue to choose a hands-off approach to climate risk mitigation," Waxman added.
Vanguard recently surpassed BlackRock as the world's leading institutional investor in fossil fuels, with the former holding $269 billion in coal, oil, and gas investments and the latter $263 billion.
\u201c"These banks target communities, like mine, treating us as collateral damage to corporate profiteering," says @Mzozane reflecting on the results of today's annual shareholder meetings at @Citi, @WellsFargo, and @BankofAmerica\n\nhttps://t.co/ZcGCLj13cO\u201d— Stop the Money Pipeline (@Stop the Money Pipeline) 1682452405
"Big investors are ignoring science and the needs of frontline communities, protecting the status quo over the changes needed to protect people and planet from climate disaster," Alec Connon, coordinator of the Stop the Money Pipeline, said in a statement. "A transition is coming one way or another: Banks and their investors can help make it orderly and just, or they can pretend they don't see what's coming as they drive the planet off a cliff."
"Investors who voted against these resolutions should expect to have a hard time sleeping at night with the knowledge that their misplaced greed will lead to climate destruction and chaos," Connon added.
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The Right Embraces Shareholder Activism in War on So-Called "Woke" Capitalism
Right-wing shareholder proposals that target environmental, social, and governance (ESG) frameworks are up 60% compared to this time last year.
Apr 21, 2023
After years of criticizing progressives for shareholder activism focused on social justice and environmental concerns, right-wing groups and ideologues are embracing the same strategy themselves.
At publicly held companies, right-wing shareholder proposals that target environmental, social, and governance (ESG) frameworks are up 60% compared to this time last year, according to the 2023 Proxy Previewreport published by the nonprofits As You Sow, the Sustainable Investments Institute, and Proxy Impact.
Of the hundreds of shareholder resolutions that have been filed so far in 2023, the report identifies 43 proposals that decry corporate attempts to redress climate inaction, racial inequity, abortion restrictions, and gun violence. Additional anti-ESG proposals are likely to be filed in advance of annual shareholder meetings, which usually take place in May.
Most of the proposals come from groups that are key players in the Right's war on "woke" capitalism.
Groups Leading the Charge
The National Center for Public Policy Research (NCPPR), a right-wing advocacy group, has filed at least 17 anti-ESG proposals with various corporations this year, the most of any conservative organization profiled in the report. NCPPR has spearheaded a campaign it calls Stop Corporate Tyranny, which rails against "cancel culture" and accuses corporations of both allowing themselves to be weaponized against "traditional American values" and silencing conservative perspectives in adopting "the progressive Left's extreme and radical agenda."
Quoting Fox News host Tucker Carlson, NCPPR claims that "the biggest threat to liberty is no longer big government, its [sic] big business."
NCPPR claims that "the biggest threat to liberty is no longer big government, its [sic] big business."
The campaign is part of NCPPR's Back to Neutral Coalition, which includes the American Legislative Exchange Council (ALEC), the right-wing corporate bill mill that works with state lawmakers across the country to enact pro-corporate legislation. ALEC chief executive Lisa Nelson is a member of the NCPPR board.
The National Legal and Policy Center (NLPC), another major anti-woke culture warrior, has filed the second most anti-ESG shareholder proposals this year. A former associate member of the State Policy Network (SPN), a right-wing coalition of free market think tanks, the so-called "watchdog" group has received funding from major right-wing donors, including the Sarah Scaife Foundation.
The majority of NLPC's proposals are concerned with "ties to Communist China" and have been filed with large multinational corporations such as Starbucks, McDonald's, Merck, General Motors, Boeing, and Apple. A different resolution targeted at Meta, the parent company of Facebook, demands a report on "government censorship."
Climate Change
Corporate policies that attempt to curb fossil fuel use and address the climate crisis have long raised the ire of right-wing groups—many of which receive major funding from the oil and gas industry.
NLPC filed memos with the Securities and Exchange Commission (SEC) urging shareholders at Bank of America, Citigroup, Goldman Sachs, and Wells Fargo to vote against proposals asking the banks "to take additional actions to reduce greenhouse gas emissions." Shareholder meetings for all four financial institutions are being held next week.
Steven Milloy, a former Fox News columnist and lobbyist for the tobacco and fossil fuel industries who currently sits on the board of the libertarian Heartland Institute, filed a shareholder proposal with Alliant Energy pressing the company to justify its "pure fantasy" of ever achieving net-zero emissions.
Milloy also filed a proposal at Chevron that would require the energy giant to rescind its 2021 emissions reduction pledge. The proposal appears to have been crafted in conjunction with Strive Asset Management, the company founded by anti-woke firebrand and 2024 Republican presidential contender Vivek Ramaswamy.
Investment fund magnate David Bahnsen filed a proposal with Chevron demanding that the company establish a committee to analyze the risks associated with decarbonization goals, and NCPPR filed a similar proposal with Duke Energy.
Victims of "Diversity"
Six of NCPPR's shareholder proposals raise concerns about racial justice initiatives undertaken by companies, a leitmotif in the Right's attacks on "stakeholder capitalism" and ESG investing, along with alleged reverse racism against white conservatives. Last year, the director's letter in NCPPR's Investor Value Voter Guide 2022 promised that the guide would help proxies vote "against the new racism and sexism of 'equity'" and "other hard-left goals of so-called stakeholder capitalism and ESG." (The organization's 2023 guide has not yet been released.)
Other proposals focus on anti-discrimination and "viewpoint diversity." For instance, NCPPR's proposal for the grocery chain Kroger calls for a report detailing "the potential risks associated with omitting 'viewpoint' and 'ideology' from its written equal employment opportunity (EEO) policy." The SEC ruled that Kroger could omit the proposal.
NCPPR warns against "committing illegal or unconscionable discrimination against employees deemed 'non-diverse'" in the name of "so-called 'equity.'"
At Home Depot, NCPPR hopes to rescind the racial equity audit that shareholders agreed to at the company's 2022 annual meeting. In a proposal with McDonald's, NCPPR warns against "committing illegal or unconscionable discrimination against employees deemed 'non-diverse'" in the name of "so-called 'equity.'"
NCPPR also takes up claims of liberal media bias and "viewpoint discrimination" in its proposal filed with AT&T, which criticizes the company for not renewing DirecTV's contract with the right-wing One America News (OAN) in the wake of its incendiary coverage of the 2020 presidential election and the subsequent insurrection.
For reasons not disclosed, Inspire Investing, a "biblically responsible" investing firm that champions anti-abortion and anti-LGBTQ views, ended up withdrawing its proposal on the "risks" associated with anti-discrimination policies, which it had filed with M&T Bank.
Abortion
NCPPR filed an anti-abortion proposal with Eli Lilly, the Indianapolis-based pharmaceutical company, in which it calls for a report on the "risks of supporting abortion." NCPPR takes issue with the company's position that its ability to attract "diverse employees" has been hindered since Indiana passed an abortion ban in 2022, and therefore, that it needs to focus its expansion efforts outside the state. NCPPR argues that Eli Lilly's embrace of diversity "ends at diversity of thought, opinion, and religious convictions." The board has recommended voting against the proposal.
Anti-abortion activist and semi-professional shareholder activist Thomas Strobhar also proposed a vote at Disney regarding transparency in charitable contributions. His organization, Life Decisions International, pressures companies to halt donations to Planned Parenthood.
Guns
NCPPR submitted a shareholder proposal to American Express that would have required the company to report on how it would "reduce the risk associated with tracking, collecting, or sharing information" regarding payment processing for the "sale or purchase of firearms." In March, the SEC ruled that American Express could omit the proposal from its proxy materials since it appeared to micromanage the company.
Gun control advocates have long urged credit card companies to track gun and ammunition purchases as a way of curtailing rampant gun violence and mass shootings. Lawmakers in states such as New York have pressured Mastercard and American Express—both based in New York—to flag suspicious gun purchases.
By contrast, Florida's Senate Bill 214—which penalizes financial companies for using a separate "merchant category code" for firearms—sailed through the Republican-controlled state senate in March and has crossed over into the house. The bill's lobbyists include Gun Owners of America, the political action arm of the Gun Owners Foundation, which has received funding from the right-wing Ed Uihlein Family Foundation and Shell Oil, according to tax filings.
Bahnsen filed a shareholder proposal with MetLife taking issue with the company's decision "not to offer a bulk discount to NRA members" and to exclude "firearms makers from investment portfolios."
Based on the gun industry's fear that President Biden will reinstate Operation Choke Point—an Obama-era program created to curtail bank fraud and discourage financial institutions from doing business with "high-risk merchants"—NLPC filed three identical proposals with JPMorgan Chase, Mastercard, and Wells Fargo to require the companies to report on any government requests to close accounts, along with their own policies for dealing with those requests. The SEC denied the proposals made to JPMorgan and Wells Fargo, and, in early March, NLPC withdrew a comparable proposal with Mastercard.
In a similar move, Bahnsen filed a shareholder proposal with MetLife taking issue with the company's decision "not to offer a bulk discount to NRA members" and to exclude "firearms makers from investment portfolios" (along with "coal companies and oil sands extractors"), according to Proxy Preview.
Bahnsen sits on the advisory board of the Viewpoint Diversity Score, a right-wing effort to negatively rate companies that take into account social justice concerns such as racial equity. The index, which is a project of the LGBTQ hate-group the Alliance Defending Freedom, received an Innovation Prize from the right-wing Heritage Foundation last year.
ESG as Good Business
Overall, the shareholder activism the Right has undertaken to counter corporate pressure from the Left has met with limited success. Anti-ESG proposals are typically unpopular with shareholders and on average garner 4% support or less. In addition, the volume of right-wing filings still pales in comparison with the number coming from progressive organizations. For example, As You Sow has filed at least 89 proposals this year, mostly related to advancing climate goals, diversity initiatives, and pro-union policies.
Other anti-ESG shareholder strategies—such as the new proxy advisory services launched by Ramaswamy's company Strive—appear to be gaining traction. Indiana's Public Retirement System recently rewarded Strive a $150,000 no-bid contract.
Social and climate risks have real impacts on the bottom line, and investors and customers increasingly expect businesses to take them into consideration.
Yet the overwhelming response from corporate boardrooms has been: ESG policies make financial sense. As Andrew Winston argued in the Harvard Business Review, "The banks pushing back on anti-ESG laws are not seeking medals for philanthropy; they're doing it because it's good business." Social and climate risks have real impacts on the bottom line, and investors and customers increasingly expect businesses to take them into consideration.
An entire generation of talent "won't stay with us if we don't care about ESG or purpose or whatever we call it," Mars CEO Poul Weihrauch toldFinancial Times last month. "So from my chair, I think it's a nonsense conversation. We don't believe that purpose and profit are enemies."
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1,300+ Scientists Urge JPMorgan Shareholders to Vote for End to New Fossil Fuel Financing
"It's time for big banks to listen to the science and stop funding climate destruction," said one advocate.
Apr 10, 2023
As the fossil fuel-driven climate crisis continues to wreak havoc around the globe, more than 1,300 scientists and researchers on Monday published a letter imploring JPMorgan Chase shareholders to support a resolution that asks the financial giant's board of directors to "adopt a policy for a time-bound phaseout" of bankrolling new coal, oil, and gas projects.
The resolution in question is being proposed at the bank's annual meeting on May 16. If passed, "this resolution would encourage JPMorgan Chase to stop providing financing, including loans, bonds, and underwriting, to companies engaged in fossil fuel expansion," states the letter, which was led by prominent climate experts in partnership with the Union of Concerned Scientists (UCS) and Stop the Money Pipeline (STMP). "By making this commitment, JPMorgan Chase could signal its intention to advance the clean energy transition and help ensure a safer future for people and our planet."
Arielle Swernoff, U.S. Banks Campaign Manager at STMP, said in a statement that "the science is clear: in order to reduce emissions in line with the Paris agreement, fossil fuel expansion must stop now, yet JPMorgan Chase and other big banks like Citi, Wells Fargo, and Bank of America continue to pour money into new oil, gas, and coal."
"Big banks must be held accountable for their role in causing the climate crisis."
Despite pledging to put themselves and their clients on a path to "net-zero" greenhouse gas emissions, the world's 60 largest private banks pumped $4.6 trillion into coal, oil, and gas projects from 2016 to 2021. The four U.S. financial behemoths mentioned by Swernoff are responsible for a quarter of all fossil fuel financing identified since the Paris agreement entered into force. JPMorgan Chase alone provided more than $382 billion to coal, oil, and gas firms during the aforementioned six-year period, including $65.4 billion to the 20 corporations doing the most to ramp up the extraction of planet-heating fossil fuels.
"Over 1,300 scientists have come together to say: enough is enough," said Swernoff. "It's time for big banks to listen to the science and stop funding climate destruction."
Kathy Mulvey, director of the Climate Accountability Campaign at UCS, stressed that "as people around the world face climate-related extreme weather disasters, threats to public health, and systemic economic risk, big banks are choosing to ignore climate science by providing billions of dollars in financing to fossil fuel companies that continue to expand their production of oil and gas."
"JPMorgan Chase and other financial institutions are continuing to mislead shareholders about what is needed to reach global climate goals and instead seeking to maintain a dangerous status quo that prioritizes profit over people and the environment," said Mulvey. "To safeguard communities, investors, and the global economy, shareholders should insist that banks incentivize swift and deep cuts in heat-trapping emissions to limit climate change harms and facilitate a just transition to a clean energy economy."
\u201cToday, over 1,300 scientists called on shareholders of @jpmorgan to vote for the bank to stop funneling billions of dollars to fossil fuel companies that continue expanding the production of climate-destroying products. #PeopleVsFossilFuels \n\n\u27a1\ufe0fhttps://t.co/MlM9bPQsGE\u201d— Union of Concerned Scientists (@Union of Concerned Scientists) 1681136011
Mulvey was echoed by Ayana Elizabeth Johnson, co-founder of the Urban Ocean Lab and a lead signatory of the letter.
"To avoid the most dangerous levels of planetary warming, we must rapidly end our reliance on fossil fuels and transition to a clean energy economy that meets the needs of all communities," said Johnson. "Meanwhile, financial institutions like JPMorgan Chase are funding continued expansion of the fossil fuel industry, even as all the warning signs for our planet are flashing red."
Last week, data from the U.S. National Oceanic and Atmospheric Administration showed that annual emissions of carbon dioxide, methane, and nitrous oxide increased again in 2022, pushing atmospheric concentrations of the three main heat-trapping gases to all-time highs.
The Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency have made clear that increasing fossil fuel supply is incompatible with limiting global warming to 1.5°C above preindustrial levels, beyond which the planetary emergency's consequences will grow worse.
Roughly 1.1°C of warming since the late 1800s is already fueling increasingly frequent and intense extreme weather across the globe. In 2022, the U.S. alone experienced 18 separate billion-dollar disasters turbocharged by climate change, including droughts, wildfires, and hurricanes. Together, these events killed 474 people and cost an estimated $172 billion. Such catastrophes disproportionately hurt low-income populations in the U.S., and the deleterious public health and economic impacts of unmitigated greenhouse gas pollution are even more severe in poor nations that bear the least responsibility for the crisis.
"JPMorgan Chase and other financial institutions are... seeking to maintain a dangerous status quo that prioritizes profit over people and the environment."
After the IPCC released its latest assessment report last month, U.N. Secretary-General António Guterres said that limiting global warming to 1.5°C is possible, "but it will take a quantum leap in climate action," including a prohibition on approving and financing new coal, oil, and gas projects as well as a phaseout of existing fossil fuel production.
Despite ample evidence that burning more coal, oil, and gas will exacerbate the deadly effects of the climate crisis, profit-hungry fossil fuel corporations—supported by trillions of dollars in annual subsidies and industry-friendly public policies—are moving ahead with plans to expand drilling.
A pair of scholars recently introduced the novel legal theory of "climate homicide," which aims to hold fossil fuel corporations criminally liable for deaths caused by the disasters they are knowingly unleashing.
Johnson insisted Monday that like Big Oil, "big banks must be held accountable for their role in causing the climate crisis."
"Shareholders," she added, "should insist that banks accelerate and deepen investment in a just, clean energy future."
According to the letter: "JPMorgan Chase is an internationally known and respected bank. By ending support for fossil fuel expansion, it could help set the global stage for a just transition to a more sustainable and livable future while acting decisively to protect its shareholders and the wider economy from the financial shocks associated with worsening climate change."
"This is no less than what science requires to keep our planet a livable place for current and future generations, including our children and grandchildren," the letter continues. "Please use your vote at this year's shareholder meeting to help protect people and our planet from climate chaos."
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