Shareholder Resolutions

When dialogue attempts are not working, ESG Services seeks the views of other shareholders on the environmental, social and governance issue facing the company. This is done by filing a shareholder resolution that is included in the management proxy circular and submitted to a vote at the company's annual general meeting (AGM).

Shareholder resolutions can be a powerful tool for raising the awareness of environmental, social and governance issues among directors, senior executives and other shareholders. The time between filing the resolution and the company finalizing the management proxy circular for publication is often fruitful for dialogue, because companies wish to see the resolution removed from the AGM agenda. This often prompts companies to allocate more resources to ESG concerns. As a result of this, shareholder resolutions do not always go to a vote.

In general, NEI will withdraw the resolution in the following situations:

  • The company agrees to substantially adopt our resolution without a vote.

  • The company agrees to partially adopt our resolution and commits to a series of meetings between our ESG Services team and key operational personnel, company decision-makers, and appropriate stakeholders to explore issues further.

  • The company provides us with evidence to show that the resolution is "moot" because it is already dealing with the issue.

If the resolution goes ahead, a Proxy Alert is issued challenging the company's response to our resolution and offering additional reasons for investors to support it.

Because many investors vote with management automatically without considering the merits of the case, when our resolutions do go to a vote, they seldom win majority support. But they seldom need to. Recognizing that shareholder concern about an issue is building, and that the resolution we have advanced offers an effective response to a significant business challenge, companies are often willing to negotiate and begin adopting more progressive policies.

Below are the shareholder resolutions tracker and the full shareholder resolutions filed from 2011 to 2017.

2017

Company Proposal Ask Status Notes

Wells Fargo

Publish a comprehensive report by October 2018 on the root causes of past and present fraudulent activities, plans to address them, and how progress will be measured, and disclosed. The report should omit proprietary information and be prepared at reasonable cost.

Filed, 2017-11-08

Withdrawn, 2018-02-26

Co-filed proposal: lead filers The Sisters of St. Francis of Philadelphia.

Although the company published a report on the unauthorized accounts scandal in early 2017, it had not undertaken a comprehensive review of the underlying ethical and cultural causes, and further customer protection controversies came to light after the 2017 AGM.

The co-filers agreed to withdraw the proposal after Wells Fargo finally committed to conduct a comprehensive review with stakeholder input and to issue a report by the end of 2018. We will continue to engage in dialogue with the company on the implementation of the resolution.

Valero Corporation

Issue a report by December 30, 2018 with board oversight, at reasonable cost and omitting proprietary information, on Valero's strategy for aligning its business plan with the well below 2-degree Celsius goal of the Paris Agreement, while continuing to provide safe, affordable and reliable energy.

Filed, 2017-11-03

Withdrawn, 2017-12-12

Co-filed proposal: lead filers Mercy Investment Services.

Valero's peers have begun to provide disclosure in line with the proposal ask but to date the company has not indicated that it has assessed the risks of the energy transition to its business model nor has it indicated it has a strategy in place to mitigate those risks.

The proposal was withdrawn after Valero committed to issue a report by the end of 2018 that outlines the company's strategy for aligning its business plan with the well below 2 degree Celsius goal of the Paris agreement, while still providing safe, affordable and reliable energy.

Chevron

Adopt a policy requiring the Chair of the board of directors to be an independent member of the board. The policy would be phased in for the next CEO transition.

Filed, 2017-12-12

Co-filed proposal: lead filers Zevin Asset Management, LLC.

The proposal notes that Chevron is facing several strategic risks that could possibly have been mitigated by independent oversight at the board level. The current CEO, who also serves as the Chair, will be leaving in 2018, creating the opportunity for Chevron to fix this governance weakness.

2016

Company Proposal Ask Status Notes

Wells Fargo

Commission a comprehensive report, available to shareholders by October 2017, on the root causes of the fraudulent activity and steps taken to improve risk management and control processes. The report should omit proprietary information and be prepared at reasonable cost.

Filed, 2016-11-08

Voted, 2017-04-25

Co-filed proposal: lead filers The Sisters of St. Francis of Philadelphia. We engaged the company regarding concern at the fraudulent activities recently uncovered by the Consumer Financial Protection Bureau (CFPB) involving the opening of millions of unauthorized accounts, urging the Board to commit publicly to further actions to rebuild trust, but did not get assurance that issues raised would be addressed.

Read the Proxy Alert here. The proposal received 22% support at the 2017 AGM.

Occidental Petroleum Corp.

A comprehensive review of Occidental's public policy advocacy on climate including an assessment of the organizations in which Occidental Petroleum is a member, or otherwise supports financially, regarding their lobbying on legislation at federal, state, or local levels. A summary report of this review, prepared at reasonable cost and omitting proprietary information, should be reviewed by the Board Governance Committee and made available to shareholders.

Filed, 2016-11-08

Withdrawn, 2017-01-01

Co-filed proposal: lead filer The Needmor Fund.

Occidental challenged the proposal at the Securities Exchange Commission (SEC). The co-filers decided to forego mounting a legal defense and instead withdrew the proposal voluntarily. However, in withdrawing the proposal we were able to gain a commitment from the company to meet with shareholders to discuss the underlying intent of the proposal.

Chevron

Publish an annual assessment of long-term portfolio impacts to 2035 of plausible climate change scenarios, at reasonable cost and omitting proprietary information. The report should explain how capital planning and business strategies incorporate analyses of the short- and long-term financial risks of a lower-carbon economy. Specifically, the report should outline impacts of multiple, fluctuating demand and price scenarios on the company's existing reserves and resource portfolio — including the International Energy Agency's "450 Scenario," which sets out an energy pathway consistent with the internationally recognized goal of limiting global increase in temperature to 2 degrees Celsius.

Filed, 2016-11-21

Withdrawn, 2017-04-24

Co-filed proposal: lead filer Wespath Investment Management and Hermes EOS.

The co-filers agreed to withdraw the proposal in acknowledgement of the company's decision to publish a report prior to the AGM that addressed some of the proposal's key asks. The disclosure of the report made the proposal partially moot. In withdrawing the proposal, we noted that Chevron's disclosure was lacking in some key areas but represented a good first effort that could be improved through further dialogue with shareholders. We will continue to engage in dialogue with the company in an effort to greatly increase the quality and utility of the disclosure.

2015

Company Proposal Ask Status Notes

Suncor

Provide ongoing reporting on how Suncor is assessing, and ensuring, long-term corporate resilience in a future low-carbon economy. Specifically, reporting could be stand-alone or integrated into current company reporting mechanisms and could address Suncor's technology pipeline, emission reduction targets and performance, innovation and energy diversification strategies, provide a narrative on any stress-testing done against external low carbon scenarios (e.g. IEA's 450 and 2C Scenarios), and other relevant strategies.

Filed, 2016-01-28

Voted, 2016-04-28

We filed the proposal with Suncor after a long engagement with the company with the explicit understanding that management would recommend a vote FOR: a key governance development in the Canadian energy sector. We believe that part of the motivation of the company to support the proposal was its desire to engage its shareholder base in a deeper discussion on its strategy for a low carbon future.

Read our Proxy Alert here. The proposal received over 98% support at the 2016 AGM.

Read our remarks on the proposal, made at the 2016 AGM, here.

Suncor: Proxy Response: Low-Carbon Strategic Resilience

2014

Company Proposal Ask Status Notes

Royal Bank of Canada

Provide a report assessing the results and risks of basing senior executive compensation on horizontal comparison with peer companies; discussing the potential to integrate vertical comparison metrics, such as average employee compensation within the company; and indicating if the company plans to change its approach to setting total compensation, or explain the rationale for not doing so.

Filed, 2013-10-08

Withdrawn, 2014-02-26

Follow-up on a similar proposal filed last year, which was withdrawn based on the company's initial commitment to study the issues raised.

We met with the company and were satisfied that our request would be addressed in future reporting.

Read our remarks on the withdrawal of the proposal, made at the 2014 AGM, here.

CIBC

Provide a report assessing the results and risks of basing senior executive compensation on horizontal comparison with peer companies; discussing the potential to integrate vertical comparison metrics, such as average employee compensation within the company; and indicating if the company plans to change its approach to setting total compensation, or explain the rationale for not doing so.

Filed, 2013-11-28

Withdrawn, 2014-04-24

Follow-up on a similar proposal filed last year, which was withdrawn based on the company's initial commitment to study the issues raised.

We met with the company and were satisfied that our request would be addressed in future reporting.

Google

Adopt a set of principles to address the impact of Google's tax strategies on society, with particular focus on Google's employees, customers and suppliers. Publish annual reports to shareholders discussing implementation of these principles.

Filed, 2013-12-20

Voted, 2014-05-14

Co-filed proposal: lead filer Domini Social Investments. The company did not respond to our offer of dialogue on withdrawal of the proposal.

Read our Proxy Alert here. The proposal received 1% support at the 2014 AGM, representing approximately 4% of votes not controlled by management.

Read our remarks, made at the 2014 AGM, here.

Through PRI, we joined an international taskforce to explore tax-related ESG risks, identify good practices and build relationships with other stakeholders in the responsible tax space. The collaboration published a PRI guidance document for investors seeking to engage on tax, which would be used in follow-up collaborative engagement with companies, including Google.

Apple

Provide an annual report on the principles that guide Apple's tax strategies.

Filed, 2014-09-11

Withdrawn, 2015-03-10

Co-filed proposal: lead filer Domini Social Investments.

Through PRI, we joined an international taskforce to explore tax-related ESG risks, identify good practices and build relationships with other stakeholders in the responsible tax space. The collaboration published a PRI guidance document for investors seeking to engage on tax, which would be used in follow-up collaborative engagement with companies, including Apple.

2013

2012

2011