Investors with a collective $6.5 trillion in assets reminded U.S. companies with the highest greenhouse gas emissions to disclose their lobbying activities related to climate change — and to prepare for more shareholder pressure.
In a series of letters sent to Climate Action 100 Plus' list of the top 47 greenhouse gas emitters in the U.S., a steering committee of the investor group also reminded the companies that beginning in 2021, their progress will be measured against a new emissions benchmark, the Climate Action 100 Plus Net-Zero Company Benchmark.
"As long-term investors, we need to see our portfolio companies address the financial risks posed by climate change. We are concerned about the impact of climate change on our investments, as well as its impact on the economy as a whole," said New York State Comptroller Thomas P. DiNapoli, a letter signatory who is sole trustee of the $216.3 New York State Common Retirement Fund, Albany.
"In order to assess these risks to our portfolio companies, we need greater transparency and accountability, especially when it comes to lobbying — or supporting trade organizations that are lobbying — against efforts to address this ever-mounting threat," he said in a statement.
Other signatories included officials with the $416.9 billion California Public Employees' Retirement System, Sacramento, the $257.9 billion California State Teachers' Retirement System, West Sacramento and New York City Controller Scott Stringer.
The letter noted "significant positive actions" since the targeted companies were first asked a year ago to disclose their lobbying activities. Those include a successful shareholder resolution at Chevron for the company to report how its lobbying activities align with the Paris Agreement goal of limiting average global warming to less than 2 degrees Celsius, and similar ones at Delta Air Lines and United Airlines.
"It is widely expected that U.S. investors will be expanding engagements and shareholder resolutions on this topic in the 2020-2021 proxy season," the letter said.
The investors also noted "significant growth in Europe" of actions taken by companies and investors to increase disclosure of climate-related lobbying, with several companies leaving their trade associations over conflicts on climate policy.
"We are also aware of the increased discussion regarding new U.S. climate policies at the federal, state and local levels," they wrote.
The letter went to the 47 U.S.-based companies among the 161 focus companies on the Climate Action 100 Plus list that represents up to 80% of global industrial greenhouse gas emissions. In September, the investor group, with more than 500 global investors and a collective $47 trillion in assets, called on the companies to commit to net-zero greenhouse gas emissions and to prepare for the benchmark.