Investors Push 13 Corporations to Adopt Clean Energy Strategies in Shareholder Filings
BOSTON, February 19, 2012 /3BL Media/ - Leading U.S. institutional investors and pension funds have filed shareholder resolutions with 13 corporations, urging them to source more renewable energy and improve energy efficiency in order to mitigate risks posed by climate change and increase shareholder value. As a result of shareholder dialogues, companies in the information technology (IT) and real estate sectors, including IBM and Public Storage, have agreed to increase reporting on their clean energy performance.
“It has become all too clear that smarter and cleaner energy consumption is critical not only to the long-term health and well-being of the public and the planet, but also to our portfolio companies,” said New York City Comptroller John C. Liu, who filed resolutions on sustainability reporting and energy use with Equity Residential, Kimco Realty Corporation, and SL Green Realty. “Real estate, IT, and other industries that rely so heavily on energy production and consumption should read the writing on the wall: efficient use of energy carries long-term benefits for both the public and their profits.”
Resolutions were filed by the California State Teachers' Retirement System (CalSTRS), Calvert Investments, Green Century Capital Management, New York City Office of the Comptroller and Presbyterian Church USA with 13 companies—CF Industries, Citrix Systems, Dun & Bradstreet, Electronic Arts, Equity Residential, Fiserv, Kimco Realty Corporation, IBM, Public Storage, Rockwood Holdings, Roper Industries, SL Green Realty and Walter Energy.
This series of shareholder filings follows a recent report by Ceres, Calvert Investments, and WWF showing that 60 percent of companies within the combined Fortune 100 and Global 100 have set a renewable energy goal, a greenhouse gas reduction goal or both.
“The world’s largest companies recognize that clean, efficient energy use makes good business sense,” said Mindy Lubber, director of the $11 trillion Investor Network on Climate Risk and president of Ceres, which helped to coordinate the filings. “Shareholders are encouraging these companies to adopt clean energy strategies so that they can capture short-term benefits and mitigate long-term risks.”
Shareholders gained early traction on clean energy in the IT sector, as Green Century Capital Management will withdraw is shareholder filing with IBM after the company responded with further information on its renewable energy and energy efficiency measurements and policies. This withdrawal agreement is a result of positive investor dialogue with the company.
"Energy use is a key concern for many firms in the IT sector. As investors, we ask that companies set clear, quantifiable goals and report on progress in order to boost efficiency, reduce emissions and limit other environmental impacts,” said Leslie Samuelrich, Green Century Capital Management, lead filer of the IBM resolution. “After the hottest year on record in the United States, we are pleased to see IBM commit to a rigorous approach to sourcing clean energy, which will help to reduce its greenhouse emissions.”
The California State Teachers' Retirement System (CalSTRS) also focused several of its filings on companies in the IT sector, including Citrix Systems, Dun & Bradstreet, Electronic Arts and Fiserv, pressing for increased energy efficiency planning and reporting. These resolutions were filed as a follow-up measure to a letter sent by CalSTRS to 100 companies in mid-2012, which asked for increased disclosure on energy management practices.
“For large energy users like IT firms, inefficiency can be costly to shareholders. Investing in efficiency is an excellent option for many companies, with internal rates of return often approaching 20 percent or more,” said Brian Rice, Portfolio Manager at CalSTRS. “These resolutions are aimed at establishing clear goals for improving performance.”
CalSTRS filed an additional efficiency-focused resolution with Walter Energy, a mining firm.
Energy use in the real estate sector emerged as another key area of interest for investors. The U.S. Department of Energy estimates that buildings account for 40 percent of total energy use in the United States. Accordingly, the New York City Office of the Comptroller filed resolutions on sustainability reporting and energy use with Equity Residential, Kimco Realty Corporation, and SL Green Realty. Calvert Investments filed with Public Storage, focused on energy efficiency.
New York City’s resolutions request that the three firms issue sustainability reports focused on resource use and efficiency. In 2012, a similar resolution filed by New York City garnered a 45 percent affirmative vote with Equity Residential’s shareholders.
According industry association estimates, self-storage has been the fastest-growing sector of the U.S. commercial real estate market for the last 30 years. Calvert Investments’ resolution requests that the world’s largest owner and operator of self-storage facilities, Public Storage, set goals for reducing energy use. After positive dialogue with the company, Calvert withdrew this resolution, as Public Storage has agreed to disclose more information about its energy use and reductions over time.
These resolutions are part of a broader investor initiative challenging companies to address climate and sustainability risks. Thus far in the 2013 proxy season, investors working with Ceres have filed 91 resolutions with 78 companies.
Ceres is an advocate for sustainability leadership. Ceres mobilizes a powerful coalition of investors, companies and public interest groups to accelerate and expand the adoption of sustainable business practices and solutions to build a healthy global economy. Ceres also directs the Investor Network on Climate Risk (INCR), a network of 100 institutional investors with collective assets totaling more than $10 trillion.
For more information, visit http://www.ceres.org