GE shareholders vote for full emissions-reduction plan

General Electric shareholders resoundingly approved a resolution Tuesday calling for the company to report how it plans to achieve net-zero greenhouse gas emissions by 2050, in alignment with the Paris Agreement's 1.5-degree Celsius goal.

The resolution presented by As You Sow on behalf of Amalgamated Bank was approved by 98% of shareholders, according to preliminary results from the annual meeting Tuesday.

In 2020, GE announced a goal of carbon neutrality by 2030 for its direct operations and facilities, covering Scope 1 and 2 emissions. This year's resolution calls for GE to report across all its operations and products, including the largest emissions component covering Scope 3 product emissions.

The GE shareholder resolution was a critical test case for the Climate Action 100+ investor initiative that represents more than 500 investors with a collective $54 trillion in assets. The resolution references a new Net-Zero Company Benchmark used by Climate Action 100+ to track companies' progress on Paris-aligned goals. A similar resolution is scheduled for a vote at Caterpillar's annual meeting in June.

"While General Electric has done a lot to look at the efficiency and carbon impact of specific products, it has been slow to address its Scope 3 emissions and address how its high-carbon client base fits into a low-carbon economy," said Ivan Frishberg, director of impact policy at Amalgamated Bank, in a statement. "We hope that the momentum from this resolution helps move the company to fully account for its full emissions inventory and align its business with the ongoing transition to a net-zero economy."

Climate Action 100+ officials note that similar Net-Zero Company Benchmark resolutions were withdrawn earlier this year when Valero and United Airlines agreed to undertake the requested action.

GE supported the shareholder proposal. “GE management was wise to favor requiring detailed accounting of its progress on Scope 3 emissions reductions, the largest segment of emissions,” said Kirsten Snow Spalding, senior program director of the Ceres Investor Network. “Both GE management and shareholders understand the stakes our economy faces.”

A majority of shareholders, 57.7%, also rejected proposed pay packages for GE executives, including Chairman and CEO Henry Lawrence “Larry” Culp Jr. The vote was advisory and non-binding.

Mr. Culp earned $73 million in 2020, most of it from two stock awards. His compensation was increased in 2020 to address a market downturn and to keep him at the helm.

Lowered stock performance goals for his package caused both Institutional Shareholder Services and Glass Lewis to recommend a vote against it and the compensation committee. In a report, Glass Lewis said “the revised award provides Mr. Culp with the same amount of compensation in dollars for creating less shareholder value.”