Tag Archives | GHG

SSgA Critical of GHG Short-Term Disclosures

SSgA critical of GHG short-term perspective offered up by oil and gas, mining and utility disclosures on addressing greenhouse gas emissions. If we are to maintain a salubrious environment, much of the coal and oil will turn out to be stranded assets. Given that reality, I reallocated most positions I had in this sector to others more likely to continue to grow in coming decades.

Index funds, such as those held by SSgA, BlackRock and Vanguard do not have that option, as long as heavy GHG emitters remain in the indexes. I am glad they remain invested because shareholders are often in a better position to press for change than consumers and governments. It is good to see SSgA taking something of a leadership role among the largest funds. See prior post, Morningstar Direct Uncovers ESG Hypocrites.

SSgA Critical of GHG Short-Term Focus

SSgA notes that oil and gas, mining and utilities collectively account for more than one quarter of annual greenhouse gas (GHG) emissions. As such, they should be taking a leadership role in addressing the long-term impacts of GHG emissions. Instead, their research by Rakhi Kumar and Michael Younis finds:

  • A majority of companies (55%) are using one- to three-year time horizons for their GHG emissions-reduction goals, rather than longer time horizons needed to drive strategic change.
  • Only two of surveyed companies identify review of strategic opportunities related to sustainability in committee charters. None of the others set clear expectations regarding the eventual shift to a low-carbon economy as an opportunity to shape long-term strategy.
  • 43% of companies established absolute GHG reduction goals, 28% focused on intensity or efficiency targets and 10% set both absolute and intensity targets.
  • US-based companies lag peers in Europe, Australia and Canada in disclosing carbon pricing and GHG emissions-reduction goals.
  • Only half of the companies disclose either an average carbon-price assumption or a range of carbon prices; no company discloses both.

See Climate-Related Disclosures in Oil and Gas, Mining, and Utilities. According to Rakhi Kumar: “We are sending the paper to companies via emails and will bring it up during engagement.”

CalPERS and CalSTRS to Evaluate Portfolio Impacts

Senate Bill 964 defines “climate-related financial risk” at the risk that the changing climate and the transition to a low-carbon economy pose to investments. CalPERS and CalSTRS will generate their first comprehensive reports on climate risk by January 1, 2020. See IEEFA and environmental groups warn CalPERS/CalSTRS about climate risk.

   

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CII Highlights Chinese VIE Corporate Structure Risk

A new report from the Council of Institutional Investors (CII) underlines the risks posed to investors by a corporate structure called a variable interest entity (VIE). Sixty two percent of Chinese companies listed on U.S. stock exchanges use a VIE, including internet giants Sina, Baidu, Alibaba and JD.com. U.S. exchanges are experiencing a surge of Chinese VIE IPOs, with 20 filings this year, including 15 since September 1, compared to six in 2016 and seven in 2015. Continue Reading →

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Ordinary Business: Human Rights/GHG, Says Apple

Apple again invokes the ‘ordinary business’ exclusion roadmap provided by SEC Staff Legal Bulletin 14I (SLB 14I) in an attempt to muzzle shareholders. In the face of mounting evidence of inevitable manmade climate change and with the recognition that society has increasingly limited possibilities of mitigating the worst outcome for future generations, Jantz Management LLC submitted a shareholder proposal to Apple, Inc. asking the company to report on the feasibility of achieving net zero greenhouse gas (GHG) emissions, including Apple’s manufacturing GHG emissions, by a target date of 2030, 2040, or 2050.

Similar to a proposal submitted by Jing Zhao, requesting that Apple establish a Human Rights Committee (see no-action request), the company did not engage in dialogue with the shareholder, but responded by invoking the ordinary business exemption under rule 14a-8(i)(7), asking the SEC to allow the company to omit the Continue Reading →

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Walden Wins ESG Reporting at CLARCOR

clarcorCLARCOR Inc. (CLC) hosted its Annual General Meeting on March 29, 2016. A shareholder proposal led by Walden Asset Management for environmental, social and governance (ESG) reporting received 61% support from shareholders, excluding abstentions.

With this result, CLARCOR joins a small minority of companies to ever experience a majority vote in support of on an environmental or social resolution. According to proxy advisor ISS, just one environmental or social proposal passed out of 474 submitted in 2015. Continue Reading →

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Apple Inc. Proxy Score 47 – ‘For’ Proxy Access

Apple IncApple Inc. (AAPL) meeting on 2/26/2016 provides shareholders an opportunity to vote FOR real proxy access. Apple Inc. designs, manufactures, and markets mobile communication and media devices, personal computers, and portable digital music players to consumers, small and mid-sized businesses, education, and enterprise and government customers worldwide. It is one of the stocks in my portfolio. I will attend the 2/26 meeting in person.

ProxyDemocracy.org had collected the votes of four funds when I checked. I voted against two directors and for proxy access, therefore with the Board’s recommendations 47% of the time. View Proxy Statement.

Read Warnings below. What follows are my recommendations on how to vote the proxy in order to enhance corporate governance and long-term value.  Continue Reading →

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