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02/19/2009 11:44 AM
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Exxon, Massey, GM Named To Climate Watch List
SustainableBusiness.com News
A coalition of U.S. investors listed ExxonMobil (NYSE: XOM), Massey Energy (NYSE: MEE) and Gneral Motors
(NYSE: GM) among nine companies believed to be falling behind industry
peers in responding to the business threats associated with climate
change.
The Climate Watch List identifies firms that are potentially undermining their long-term competitiveness.
Investors filed shareholder resolutions with eight of the nine
companies--and 49 other businesses--aimed at improving their focus and
attention to the financial risks and opportunities from climate change.
The shareholder filings were coordinated by the Ceres investor
coalition
and the Interfaith Center on Corporate Responsibility (ICCR), a group
of faith-based investors.
The Climate Watch companies include influential coal companies,
oil and power producers and other businesses the investor groups
believe are not adequately dealing with climate-related business
impacts. Two of the oil companies were targeted for extensive
investments in Canada's oil sands region, where carbon-intensive
extraction technologies are being used to produce more than one million
barrels of oil each day.
The resolutions are among a record 63 global warming resolutions filed
with 56 U.S. companies and one Canadian company as part of the 2009
proxy season. The resolutions, seeking greater disclosure from
companies on their financial exposure and response strategies to
climate-related business trends, were filed by some of the nation's
largest public pension funds, as well as labor, foundation, religious
and other institutional shareholders, who collectively manage more than
$1.9 trillion in assets.
The Climate Watch companies include: Electric Power: Southern (NYSE: SO); Coal: Massey Energy and Consol Energy (NYSE: CNX); Oil & Gas: Ultra Petroleum (NYSE: UPL), ExxonMobil, Chevron (NYSE: CVX), and Canadian Natural Resources (NYSE: CNQ); Automotive: General Motors; and Home building: Standard Pacific (NYSE: SPF).
"These climate watch companies are ignoring a major business trend that
will influence their competitive positioning for years to come," said
Mindy S. Lubber, president of Ceres. "Given the political shift in
Washington, all companies should be minimizing climate risks and
maximizing clean energy opportunities. Companies that miss this trend
are setting themselves up to fail in the 21st century low-carbon
economy."
The Climate Watch companies are as follows:
--Chevron: Chevron is named to the Climate Watch List for its
extensive investments in Alberta, Canada's oil sands, and for resisting
shareholder requests to disclose potential financial risks associated
with the carbon-intensive project that encompasses millions of acres.
Greenhouse gas emissions associated with oil sands development is three
times higher than conventional oil extraction and refining according to
the investors. Chevron owns 20% of a major oil sands extraction effort,
the Athabasca Oil Sands Project, and is the operator at a large
proposed oil sands project at Ells River, yet its public disclosure of
potential financial exposure from climate regulations and other project
risks pales in comparison to Shell and Suncor. The resolution outlines
key risks from the project and asks that the company report on
environmental damage resulting from its expanding oil sands operation.
--CONSOL Energy: Given that coal combustion accounts for about
one-third of all greenhouse gas (GHG) emissions in the U.S. and given
the growing regulatory momentum to reduce emissions from power plants,
the New York City Pension Funds filed a resolution with the
Pittsburgh-based company requesting a report on how the company is
responding to growing regulatory and competitive pressure to
significantly reduce GHG emissions. CONSOL is the nation's largest
bituminous coal producer.
--ExxonMobil: ExxonMobil has been unresponsive to investor
requests for a decade regarding strategies intended to meet growing
demand for diversified clean energy sources. Four climate resolutions
filed this year request that: the board develop comprehensive GHG
emission reduction goals: that it report on the impact of climate
change on emerging markets and on U.S. leadership in achieving energy
independence; and that it disclose its plans for developing for
renewable energy. The resolutions were filed by the: Tri-State
Coalition for Responsible Investment, Jessie Smith Noyes Foundation and
Reynolds Foundation, Province of St. Joseph of the Capuchin Order, and
Neva Goodwin.
--General Motors: Investors have a long, unsuccessful history of
filing shareholder resolutions with General Motors and engaging with
the company on climate-related business strategies. The resolution
filed by the Tri-State Coalition for Responsible Investment asks
General Motors to set GHG reduction goals from its products and
operations, as other U.S. and foreign automakers have already done. The
resolution cites GM's ongoing litigation to stop California's clean car
standards from being adopted and its lackluster response compared to
Ford in developing a business model that accounts for climate change.
--Massey Energy: The Virginia-based coal company continues to
resist shareholder resolutions requesting the company to develop and
disclose a strategy for responding to climate change. Thirty percent of
shareholders voted in favor of the resolution last year. Given that
coal combustion accounts for about one-third of all GHG emissions in
the U.S., the New York City Pension Funds filed a resolution, for the
third consecutive year, requesting a report on how the company is
responding to growing regulatory and competitive pressure to reduce GHG
emissions. Massey is the nation's 4th largest coal producer.
--Standard Pacific: Unlike other leading homebuilders, Standard
Pacific has opposed shareholder requests the past three years to
disclose its strategies and performance on energy efficiency and other
climate-related issues. The resolution filed by the Nathan Cummings
Foundation asks the CA-based homebuilder to adopt quantitative goals
for boosting energy efficiency and reducing greenhouse gas (GHG)
emissions from its products and operations. Homebuilders have an
important role in mitigating climate change because 40 percent of GHGs
come from building energy use, and building energy efficiency is one of
the most cost effective means of reducing global warming pollution.
--Canadian Natural Resources Ltd: One of the largest and most
established producers currently active in Canada's oil sands, the
Calgary-based company has refused to date to meet with investors on the
issue of climate change, and, unlike other oil companies, it has not
made any renewable energy investments. Ethical Funds filed a resolution
with Canadian Natural Resources in 2007 requesting that it disclose its
climate risks, but the company has not responded to the resolution. CNQ
is the only oil company opposing the recommendations of the Government
of Alberta's Cumulative Environmental Management Association
Multi-stakeholder process.
--Southern: The nation's largest electric power producer, which
emits more than 160 million tons of CO2 emissions a year, has balked at
shareholder resolutions the past several years asking it to set GHG
reduction targets. In filing the resolution, the Sisters of Charity of
St. Elizabeth cited the company for its adequate climate risk
disclosure, but weak action to mitigate that exposure by reducing GHG
emissions. Thirty-seven percent of the company's industry peers,
including American Electric Power, Duke Energy and Exelon, disclosed
absolute GHG reductions targets in the Carbon Disclosure Project's most
recent annual survey released in 2008. Atlanta-based Southern opposes
mandatory federal limits to reduce GHG emissions.
--Ultra Petroleum: Houston-based Ultra has resisted shareholder
requests the past three years to disclose its strategies for addressing
climate change, despite relatively strong shareholder voting support.
While Ultra has a relatively small market capitalization (about $5
billion), its resistance to acknowledging climate change risks puts it
out of step with its peers. The resolution filed by the Nathan Cummings
Foundation asks the company to report on its plans to address climate
change.
Website: http://www.ceres.org/resolutions or http://www.iccr.org
