October 15, 2015 /3BL Media/ - Following another record-breaking season for climate-related shareholder resolutions and company engagements, the sustainability advocacy nonprofit group Ceres today released a report on the implementation of corporate commitments made to shareholders. The analysis found that shareholder resolutions and company dialogues helped spur over 100 corporate commitments in 2014 and 2015 to address critical sustainability challenges including reducing greenhouse gas (GHG), limiting fossil fuel industry risks, and protecting forests. The analysis also found that the majority (73 percent), though not all of the commitments, have been fully met.
“More than ever, companies are hearing loud and clear that investors are concerned about growing sustainability risks and want to see tangible steps to manage and reduce these risks,” said Chris Davis, Director of Ceres’ Investor Program. “Long-term investors—from socially responsible and religious funds to major pension funds and asset managers—are increasingly focused on environmental, social and governance factors that will drive future company performance.”
Shareholders Spur Action on Climate Change: Company Commitments From the 2014 & 2015 Proxy Seasons is based on information provided directly by investors. Through the analysis, 34 investors reported on how their engagements are creating tangible results, describing 31 commitments on sustainability reporting, 28 commitments on greenhouse gas reductions, 18 commitments on sustainable agriculture and deforestation, 15 commitments on carbon risks to the fossil fuel industry, and 9 commitments on other topics, including governance, water management and political involvement. Investors provided specific examples of their impact, including:
- Green Century Capital Management and the New York State Common Retirement Fund filing a resolution and engaging with Archer Daniels Midland – one of the top three suppliers of agricultural commodities globally – to adopt a no-deforestation policy for its global supply chains. In doing so, ADM became the first major supplier to begin implementing a no-deforestation policy for both soy and palm oil production.
- Trillium Asset Management engaging 3M to set a quantitative renewable energy goal of sourcing 25 percent of its electricity needs from renewable sources by 2025. In doing so, 3M will add nearly 800,000 megawatt hours of renewable energy use globally – primarily from wind and solar.
- Boston Common Asset Management and other investors engaging with PNC Financial Services Group to embed environmental and social risk management into its overall business model, including board level oversight, enhanced high-risk sector policies, client due diligence, and improved disclosure. Among the key PNC commitments is eliminating the extension of credit to coal producers with greater than 25 percent production from mountaintop removal (MTR) mining.
During the 2015 proxy season, 167 resolutions related to or motivated by climate change were filed, surpassing previous years records. Many resolutions focus on sustainability reporting, greenhouse gas emissions and sustainable agriculture. While investors expressed encouragement for the implementation of corporate commitments to date, they remain concerned about the escalating risks that climate change poses to the global economy, society, and the planet, and will continue monitoring implementation and engaging companies on pressing sustainability issues.
Ceres is a nonprofit organization mobilizing business and investor leadership on climate change, water scarcity and other sustainability challenges. Ceres directs the Investor Network on Climate Risk (INCR), a network of over 100 institutional investors with collective assets totaling more than $13 trillion. Ceres also directs Business for Innovative Climate & Energy Policy (BICEP), an advocacy coalition of 34 businesses committed to working with policy makers to pass meaningful energy and climate legislation. For more information, visit www.ceres.org or follow on Twitter @CeresNews.
KEYWORDS: Finance & Socially Responsible Investment, Business & Trade, CERES, Corporate Sustainability, shareholder engagement