Chevron Corp. shareholders will be able to vote on proposals calling for emissions reductions, with the Securities and Exchange Commission rejecting the company’s bid to not allow them at the upcoming annual meeting.
Mark van Baal, head of the Follow This activist investor group offering one of the proposals, called it “a breakthrough in the global fight against climate change.”
The proposal from Follow This asks Chevron “to substantially reduce the greenhouse gas (GHG) emissions of their energy products (Scope 3) in the medium- and long-term future.”
Chevron had asked the SEC to exclude the proposal on the grounds that it amounted to micromanaging ordinary business operations, a common argument in previous situations considered by the agency.
Follow This called the latest SEC action “a precedent which could compel U.S. oil majors to adopt new climate strategies.”
“We thank the SEC for its sense of urgency in giving shareholders agency in the climate crisis,” Mr. Van Baal said in a news release. “Finally, investors can vote for change.”
He said the group’s experience in Europe has shown that shareholders’ votes for concrete emissions targets led oil majors to change course and set emissions targets, including Royal Dutch Shell, BP and Equinor.
The SEC also allowed for shareholders to consider a similar proposal for Chevron filed by As You Sow, and a Follow This proposal at ConocoPhillips.
As You Sow’s proposal asks Chevron for an audited report on how significant reductions in fossil fuel demand under a 2050 net-zero scenario will affect its operations and performance and any risk to investors.
Chevron had resisted the request, saying that its third climate change resilience report satisfied it.
As You Sow President Danielle Fugere said in a separate statement: “We agree with the SEC that Chevron has not yet addressed the critical issue of whether and how a significant reduction in fossil fuel demand from the world’s transition to net-zero emissions by 2050 will affect its future financial position and the value of its assets.”
