Investors File Climate Shareholder Resolutions at Major US, Canadian Banks

NEW YORK – Today, several institutional investors — including the New York City Comptroller, As You Sow (AYS), Sierra Club Foundation (SCF), Trillium Asset Management, and Harrington Investments — announced the filing of climate-related shareholder resolutions at major fossil fuel financing banks in the US and Canada, including JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley.

• Read more in Reuters: New York pension seek stricter climate emissions rules from bank portfolios
• Read more in Bloomberg: Big Banks Told to Phase Out Financing of New Fossil-Fuel Projects

Adele Shraiman, Campaign Representative with the Sierra Club’s Fossil-Free Finance campaign said: “Major US banks have fallen behind their global peers by setting weak emissions reduction targets and continuing to pour billions of dollars into fossil fuel expansion every year. Investors are uniquely positioned to push these big banks to stop stalling and finally take meaningful steps to address the climate crisis. We look forward to rallying support behind the investors that are leading the way on these shareholder resolutions to ensure the biggest banks are aligning their practices with their commitment to the goals of the Paris Agreement.”

The resolutions call on the banks to:

• Adopt policies to phase out financing of new fossil fuel exploration and development (filed by Sierra Club Foundation, Trillium Asset Management, and Harrington Investments at JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley);
• Disclose robust transition plans on how the banks intend to align financing activities with their near-term emissions reduction targets (filed by As You Sow at JPMorgan Chase, Bank of America, Wells Fargo, Goldman Sachs, and Morgan Stanley);
• Set 2030 absolute emissions reduction targets for energy sector financing (filed by the New York City Comptroller at JPMorgan Chase, Bank of America (co-filed with the New York State Comptroller), Goldman Sachs, and the Royal Bank of Canada).

A slate of resolutions calling for policies to phase out financing for fossil fuel expansion was filed by the same investors at US banks in 2022. They received between 9 and 13% support, which was a significant milestone for these first-of-their-kind proposals. This year’s fossil fuel financing proposals have been updated to encourage banks to finance clients’ low-carbon transition so long as those plans are credible and verified. The previous resolutions were supported by many major institutional investors, including the New York State and New York City Common Retirement Funds. 

New in 2023 are the resolutions on absolute emissions reductions targets for energy sector financing filed by the New York City and New York State Comptrollers, and the resolutions calling for disclosure of climate transition plans filed by As You Sow. The day before the resolutions were filed, Denmark’s largest bank, Danske, announced a phase out of corporate financing for companies engaged in new coal, oil and gas development.

Royal Bank of Canada and the six US banks have committed to align their financing with the goals of the Paris Agreement and to achieve net-zero emissions by 2050. However, scientific consensus shows that fossil fuel expansion is incompatible with keeping global warming below 1.5C, and the big US banks continue to provide billions of dollars every year for new fossil fuel development — a fact underscored by a new report released just last week. 

Michael Esealuka, Louisiana organizer with Healthy Gulf, said: “The Gulf South is ground zero for environmental racism and climate chaos. Every year we face worsening hurricanes, freezes and floods. Big banks are directly fueling this crisis by financing a massive expansion of petrochemical plants and gas exports in our communities. Bank CEOs like Brian Moynihan, David Solomon and Jamie Dimon made climate commitments — that should mean something. Instead they profit off climate chaos as the Gulf South is made into a sacrifice zone for fossil fuels.” 

Jeffrey Jacoby, Deputy Director of Texas Campaign for the Environment, said: “Shareholders at big banks need to know that continuing to fund the fossil fuel projects that drive climate change also means perpetuating environmental racism in the Gulf South – the very same communities who’ve experienced devastating impacts from climate disasters again and again.”

INSURANCE COMPANY RESOLUTIONS

Shareholders have also filed climate resolutions at Chubb, Travelers, The Hartford, and Berkshire Hathaway – four majors in the U.S. insurance sector, another financial pillar of the fossil fuel industry. 

Green Century Funds filed resolutions with Chubb, The Hartford, and Travelers, calling on the companies to phase out underwriting of new fossil fuel projects. As You Sow filed resolutions at Chubb, Travelers, and Berkshire Hathaway requesting a report on how each company will measure, disclose, and reduce insured emissions (i.e., emissions from their clients).

Elana Sulakshana, Senior Campaigner with Rainforest Action Network, said: “Shareholders are concerned about the material risks that climate change poses to the insurance industry, as well as the risks posed by insurers’ unchecked support for new oil and gas projects. Some Republican state officials are attempting to turn financial institutions’ responsible efforts to mitigate risk into a culture war, but investors know that climate risk cannot be ignored, especially within the insurance sector. In the midst of mounting losses from Hurricane Ian and other climate disasters, Green Century Funds is sending a clear message to Chubb, The Hartford, and Travelers: phase out support for fossil fuel expansion and underwrite a clean energy future.”

Organizations are gearing up to support the climate resolutions at both banks and insurance companies this spring. Last year, members of the Stop the Money Pipeline coalition mobilized tens of thousands of everyday people to push major investors, such as state pension funds, BlackRock and Vanguard, to support climate action across corporate America. They are promising to double their efforts this year.

BACKGROUND

Comptroller Brad Lander manages the five New York City pension funds, which are valued at approximately $242 billion, making it the fourth largest public pension fund in the US. Comptroller Tom DiNapoli manages the New York State pension fund, which is valued at approximately $272 billion, making it the third largest public pension fund in the US. New York State led the resolution filing at Bank of America.

The resolutions follow a series of recent reports underscoring the scale of bank financing for fossil fuel expansion, and the lack of credible targets and plans to align with the banks’ climate commitments: 

• A Stand.earth report revealed RBC’s surging fossil finance surpassed CAD $9.2 billion within one year of joining GFANZ, despite its public commitments to reach net-zero financed emissions. Since the 2016 Paris Climate Agreement was signed, RBC has pumped more than USD $201 billion (CAD $262 billion) into fossil fuel companies, making it the fifth worst fossil fuel financier in the world, and #1 in Canada.
• A Rainforest Action Network report showed that the big six US banks provided about $445 billion in financing for the top 100 companies expanding fossil fuels between 2016-2021, which accounted for one-third of the financing from the world’s 60 largest banks to those top expanders.
• A Sierra Club report analyzing the net-zero pledges of US banks revealed that their commitments and actions fall far short of what’s needed to meet global climate goals. The report outlines why it is essential for banks to set absolute emissions reduction targets instead of intensity-only targets, especially in high-polluting sectors. At present, Citi and Wells Fargo are the only major US banks to have set absolute emissions reduction targets for their financing of the oil and gas sector.
• The 2022 Banking on Climate Chaos report, to be updated this coming March, revealed in the six years following the Paris Agreement (2016-2021), the five largest bankers of fossil fuels in the world were: JPMorgan Chase: USD $382 billion; Citigroup: USD $285 billion; Wells Fargo: USD $272 billion; Bank of America: USD $232 billion; RBC: USD $201 billion; and two others – Morgan Stanley (USD $137 billion) and Goldman Sachs (USD $119 billion) – were in the top 15 globally.

The Stop the Money Pipeline coalition is a coalition of more than 200 organizations working to hold the financial backers of climate chaos accountable.