Shareholders, Working In Concert, Change Kinder Morgan’s Tune On Sustainability

Think back to 2014: At the 20th annual United Nations Climate Change Conference of the Parties (COP 20) in Lima, Peru, political action seemed more achievable than, perhaps, it does today.  And think back to last October:  Despite the COP 21 global agreement reached in Paris in 2015, the United States had declared its intention to withdraw and political action on the climate front seemed stalled. 

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Electric Vehicles Drive Shift To Low Carbon Economy

As companies consider how to reduce their emissions to comply with the goals of the Paris Climate Treaty, they can look to electric vehicles as a feasible option.  Carbon emissions from vehicles contribute significantly to global warming, and the transportation sector is one of the larger contributors to greenhouse gas emissions (GHG) in the U.S. As institutional investors seek to offset and mitigate the rising levels of carbon and other GHGs, electric vehicles (EVs) are an increasingly viable solution. With sales of EVs growing faster than predicted a few short years ago, the outlook for EV production and adoption is becoming increasingly robust. 

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Shareholders Expand Political Disclosure And Accountability Effort As 2020 Elections Heighten Company Risks

As the 2020 campaign heats up, public companies face much greater risk from political spending. The 2018 elections provided a foretaste of what companies can expect when contributions associate them with candidates who make questionable remarks or take positions that conflict with companies’ core values and positions.

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Companies Engaged In Immigration Detention And Family Separation Face Human Rights Risks

Since mid-2017, Investors for Opioid Accountability (IOA), a coalition founded by Mercy Investment Services and the UAW Retirees Medical Benefits Trust, has become the leading shareholder force in the fight against the opioid epidemic ravaging the United States.  It now represents 54 investors with more than $3.5 trillion in assets under management.  In 2017, more than 70,000 Americans died from drug overdoses, the most ever in a single year. Of the 700,000 American deaths from drug overdoses since 1999, more than two-thirds were from opioids and many involved prescription opioids.

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NYC Pension Funds Sues Transdigm To Include Greenhouse Gas Reduction Proposal On Proxy

New York City Comptroller Scott Stringer, on behalf of the New York City pension funds (the “NYC Funds”), submitted a shareowner proposal to TransDigm Group on September 19, 2019, requesting that the company adopt a policy with time-bound, quantitative, company-wide goals for managing greenhouse gas (GHG) emissions, taking into account the objectives of the Paris Climate Agreement, and report on its plans to achieve these targets. 

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Companies Publicly Support Climate Policies But Lobby Against Them

In 2019, the investor campaign for lobbying disclosure is focusing on corporate political responsibility, with an increased concentration on climate change lobbying. More than 30 proposals have been filed asking companies to disclose their federal and state lobbying, trade association payments and support for the American Legislative Exchange Council (ALEC).

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Energy & Banking Companies Need Plan To Reduce Full Climate Footprint In Line With Paris Goals

Climate change poses growing risk to the individual companies in which shareholders invest and, significantly, to shareholders’ broader portfolios. As climate related harm accelerates, economy-wide losses are increasing and hurting portfolios. A 2018 analysis in Nature suggests that keeping global temperature rise below 1.5 degrees instead of 2 degrees can prevent over $30 trillion in economic damage.

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Fossil Fuel Industry Sees Plastic As Saving Grace, But Demand May Plummet

Plastics and other petrochemical goods are set to overtake the transport sector as the largest driver of global oil demand. Oil and chemical companies have invested a whopping $180 billion in new and projected plastics facilities, largely due to the fracking boom. But calls by governments and a variety of stakeholders to reduce single use plastics raise questions about whether projected demand for plastic products may slump, resulting in stranded petrochemical assets.  Furthermore, extreme weather is creating new risks from flooding that exacerbate plastics pollution risks from petrochemical plants.

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Shareholders Play Key Role In Reducing Deforestation And Climate Risk

As investors analyze the climate resiliency of their portfolios, they should consider risks associated with the agricultural sector and especially the conversion of forests and peatlands to crop and pasture land.  The burning and razing of forests is one of the largest contributors to global greenhouse gas emissions. Deforestation contributes as many greenhouse gas emissions as the global transportation sector, with commodity-driven deforestation itself responsible for two-thirds of tropical forest loss.

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New Report Benchmarks Integrated & Sustainability Reporting For The S&P 500

Requests for sustainability reports are evergreen in proxy season; investors have filed more than 300 proposals since 2010.  These requests for companies to provide quantified, comparable metrics about their performance on key environmental and social impacts earn substantial, sustained support from investors, with eight majority votes this decade.  Most companies are responding in some fashion, providing the metrics mainstream Wall Street analysts want to assess performance.

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Child Sexual Exploitation Online—a Growing Risk For The Technology Sector

While Information and Communications Technology (ICT) companies are now widely-held components of many investor portfolios, they are also at the center of an escalating trend in children being sexually exploited and abused online. The technology used in sex crimes against children is ubiquitous, from smartphones to gaming consoles, and through various apps, text messaging, social media sites, cloud storage, and more. And yet, ICT companies rarely disclose how they are combating these growing risks, from identifying and blocking child sex images, to investing in new solutions to stay ahead of the abusers.

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SASB Addresses Growing Demand For Sustainability Disclosure

U.S. public companies spend less time communicating with investors about ESG issues than their global peers. They also disclose less. U.S. investors, in turn, fall below the global average when incorporating ESG factors into their strategies, and have less influence over responsible business behavior. This aversion to transparency isn’t surprising, due to the treatment of “materiality” within U.S. securities law.

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Social Cost And Material Loss: The Dakota Access Pipeline

For 25 years shareholders have been raising concerns over corporate infringement on Indigenous Peoples’ Rights. Indigenous Peoples have helped to raise international awareness about how pipelines such as the Dakota Access, Keystone, and Trans Mountain projects harm local communities. Companies often minimize the social cost of public protests, even as investors contend that grassroots opposition can impose significant financial and brand risks.

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Micromanagement And Executive Compensation Challenges Under New Sec Staff Bulletin

New interpretations by the SEC of the Shareholder Proposal Rule (14a-8) in 2017 led to an increase in omissions of climate proposals last year. There is reason for concern that the number of omissions could increase further in 2019, depending on how the SEC applies its latest SEC Staff Legal Bulletin 14J, issued on October 23, 2018. 

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