According to a new report, a proportion of Wall Street´s biggest asset management companies are refusing to use their voting power to help fight the climate crisis.
Washington-based Majority Action and the Climate Majority Project published the latest report on Tuesday 17th September. It states that BlackRock Inc, the world’s largest asset manager with more than $6tn under management, and Vanguard, with assets of $5.2tn, have voted overwhelmingly against the key climate resolutions at energy companies, including a resolution at ExxonMobil’s annual shareholder meeting at Duke Energy.
If the two corporate mammoths had not gone against these efforts, at least 16 climate-critical shareholder decisions at S&P 500 companies would have received majority support in 2019 representing a corporate shift on climate, the report claims.
The group says that by refusing to use their proxy votes to support shareholder´s resolutions effectively means that companies are getting off scot-free. Even though their actions and the climate crisis are impacting investors, business models and most importantly, the planet.
Majority Action’s Eli Kasargod-Staub said: “The climate crisis is well upon us, and leading investors are stepping up to press fossil-fuel-dependent companies to align their strategies to the goals of the Paris agreement but some of the largest US investment companies are severely lagging”.
“Blackrock and Vanguard have been using their shareholder voting power to undermine, rather than support, investor action on climate, including opposing every one of the resolutions proposed by the $34tn Climate Action 100+ coalition, calling for significant board room reform in response to its failure to act on climate change”. Kasargod-Staub added.
In April, Blackrock released a report regarding climate-related risk stating: “Climate change is a risk investors can’t ignore.”
Vanguard publishes an annual investment stewardship review outlining its commitment to sustainable investing.
Majority Action, delivered a petition of 129,000 signatures to Blackrock in April, claiming they rank at the bottom of the list of fund managers using their voting powers to force companies to act responsibly on climate.
Blackrock states that its 45-member environmental stewardship team engaged 250 companies last year on the subject of climate change. They said singling out the use of proxy votes is misleading because it ignores the totality of Blackrock’s engagement on the issue.