Wall Street’s Moment of Truth – People or Fossil Fuels
Shareholder Season FAQ
What is shareholder season?
Shareholder season is a period between April and June when publicly-traded companies hold their annual shareholder meetings. At these meetings, shareholders vote on shareholder resolutions, which provide direction for how a given company does business. They are often related to social issues, including climate, racial, and economic justice. For example, shareholder resolutions can ask a company to meet emissions reduction goals, disclose information about corporate governance, or increase the diversity of its board.
Why does shareholder season matter to the climate movement?
Shareholder season is when investors tell companies how they should be doing business. It’s a critical moment to force companies to reduce their climate pollution and end the burden of fossil fuels on frontline communities. This year, we’re specifically focusing on the shareholder meetings of major US banks and insurance companies to stop the flow of money to fossil fuel expansion.
Fossil fuel companies don’t usually have enough money on hand to build out new pipelines, power plants, or oil wells – they need to go to the bank to get a loan. Most major US banks have agreed, in principle, to align their business practices with the emissions reduction timeline laid out in the Paris Agreement. However, they’re still making loans to companies expanding fossil fuel extraction. Similarly, new fossil fuel projects can’t be built without insurance, yet insurance companies are still covering new fossil fuel expansion.
This shareholder season is an opportunity for the climate movement to ensure these corporations are acting in line with their stated objectives, and in line with our values of preventing climate chaos and protecting frontline communities.
Which companies are the climate movement targeting this shareholder season?
This shareholder season, the climate movement is targeting the “big six” US banks, as well as several of the largest insurance companies and asset managers.
Banks: The “big six” banks are Bank of America, CitiBank, Goldman Sachs, JPMorgan Chase, Morgan Stanley, and Wells Fargo. Collectively, these banks have financed fossil fuels to the tune of $1.4 trillion since the Paris Agreement was signed in 2016. If we can get these banks to stop providing financial support to new fossil fuel projects, we can help draw down global emissions in line with what’s needed to protect our communities from climate chaos.
Insurance companies: Fossil fuel companies can’t build new pipelines, extraction sites, or other infrastructure without insurance. Big insurers, such as AIG, Chubb, and The Hartford know that the climate crisis isn’t a future problem – they’re paying climate damages from fires, floods, and hurricanes now. They’re also trying to deny insurance for people living in climate-vulnerable areas now, while propping up the fossil fuel industry. If we can get insurance companies to end their support of fossil fuel projects, we can stop fossil fuels from destroying our planet and our communities.
Asset managers: Asset managers pool money from a variety of sources ― high net-worth individuals, pension funds, individual retirement accounts, university and nonprofit endowments ― and invest the funds on behalf of their clients. Asset management companies such as BlackRock, Vanguard, and State Street own significant shares of some of the biggest companies in the world, including banks and fossil fuel companies. Because of their size, asset managers have the ability to significantly shift how the companies causing climate destruction do business. They’ll be key voters on these shareholder resolutions.
When are the key shareholder meetings in 2022?
Here’s when our targets are expected to hold their shareholder meetings:
- Citibank, Bank of America, and Wells Fargo: Tuesday, April 26
- Goldman Sachs: Thursday, April 28
- JPMorgan Chase: Tuesday, May 17
- Morgan Stanley: not yet announced, expected third week of May
- Chubb, AIG, Travelers, Hartford (insurance companies): not yet announced, expected May 16 – May 21
- BlackRock, Thursday, May 26th
- Vanguard, and State Street: not yet announced
Are there votes I should be aware of in 2022?
Yes! Stop the Money Pipeline is supporting resolutions that call for the banks to end their support of fossil fuel expansion and align with the 1.5 C warming pathway outlined in the Paris Agreement. According to the authoritative International Energy Agency (IEA), in order to meet the 1.5°C target, we cannot build any new coal, oil, or gas infrastructure starting immediately. The resolutions we’re backing call on the banks to adopt policies that ensure their financing does not support new fossil fuel development and take the actions required to align their business models with a 1.5°C pathway, as laid out by the IEA.
You can view the resolutions going to a vote here. These resolutions are also included in the proxy statements for Citi, Wells Fargo, Bank of America, Goldman Sachs, JPMorgan Chase, and Morgan Stanley, alongside the banks’ opposition statements to these resolutions Proponents of the resolutions can also file additional official supporting statements, known as exempt solicitations, to encourage other investors to vote yes on the resolutions. So far there are exempt solicitations filed on behalf of the resolutions at Wells Fargo, Bank of America, Citi, and Goldman Sachs.
How much of the vote does a shareholder resolution need to get to be effective?
The good news is that a shareholder resolution doesn’t need to get a majority of the vote in order to be effective – success is measured by changes in business practices, not in vote counts. According to shareholder activism group As You Sow, “Votes with more than 10% support are difficult for companies to ignore. Resolutions with 20% or more support send a clear message to corporate management that the current company policy is too risky or not beneficial to shareholder interests. Only the least responsive company would ignore one in five of its shareholders.”
What can I do to help?
There are tons of things you can do to help!
- If you have shares, use them! If you bank with JPMorgan Chase, you can vote your shares as part of our campaign with Iconik.
- Bank with Chase, Wells Fargo, Bank of America or Citibank? Sign on to the customer letter to investors asking them to vote for the shareholder resolutions ending support for fossil fuel expansion.
- Contact BlackRock, Vanguard, and State Street and ask them to vote yes for climate and support no expansion
- Contact your State Treasurer – State Treasurers manage trillions in assets, including state pension funds and other government investments. Because of this, they have significant influence over both banks and asset managers.
- Sign our petition to bank and insurance company CEOs demanding they stop supporting fossil fuel expansion