A group of more than 150 global pension funds and other assets owners on Wednesday co-filed a shareholders proposal at BP PLC, calling for the company to assess and manage the risk of climate change on its business, including reforming executive compensation incentives, said members of the coalition.
The co-filers, mostly U.K. funds, include the £2.4 billion ($3.62 billion) Environment Agency Pension Fund, Bristol, England. Other co-filers include the $29.4 billion Connecticut Retirement Plans & Trust Funds, Hartford; and three Swedish National Pension Funds, the 280.3 billion Swedish kronor ($34.2 billion) Gothenburg-based AP2, and the 272.6 billion kronor AP3 and 276 billion kronor AP4, both based in Stockholm.
The shareholders seek to pressure BP and Royal Dutch Shell PLC, where the group filed a similar proposal in December, to report their implementation of a number of climate-related actions.
They include calling on the companies to stress-test their business models against a limit on the rise in global warming by 2 degrees Celsius; “reform their bonus systems so they no longer reward climate-harming activities”; and “commit to reduce emissions and invest in renewable energy,” according to ClientEarth, a London-based co-filer and advocacy, litigation and research organization, which has about £950,000 in assets.
The proposals also call on the companies to “assess the degree to which carbon risks and reputational risk are being considered in their core business strategy” and “encourage both companies to be more transparent and detailed in their reporting to address investor concerns around long-term business strategy and value,” said a statement from the London-based Local Authorities Pension Fund Forum, which includes at least 12 U.K public pension funds co-filing the proposals.
Shell spokesmen, who had no comment specifically on the proposal, directed attention to recent Shell statements by CEO Ben van Beurden, including a Sept. 2 speech at the Center on Global Energy Policy at Columbia University in New York, in which he said, “Shell knows that climate change will quite rightly continue to rise up the political and public agenda. We are preparing for increasingly robust legislation on emissions. And we understand that renewables have a huge role to play in the energy system of the future.”
BP spokesmen couldn’t be reached for comment.
