Shell encounters ongoing collaborations with Border to Coast post setting back climate objectives, identified as unsatisfactory.
In the 2024 AGM season, there has been a notable shift in investor focus, with pension fund Border to Coast leading the charge against both oil companies and banks like PNC Bank and BOA.
Border to Coast's ongoing engagement with Shell includes a firm stance against the re-election of the chair, due to concerns over inadequate targets and decarbonisation strategy. The fund has also expressed disappointment that Shell's new medium term emissions reduction target does not cover gas. In a recent meeting with Shell's chair of the board, Andrew Mackenzie, Border to Coast urged the energy company to set tighter climate targets.
The fund has also been vocal in its criticism of UK banks, including HSBC and Barclays, facing increasing pressure over climate issues. Border to Coast has met with the executives of these banks during AGM preparation meetings, though the names of the specific individuals engaged remain undisclosed. The fund has partnered with Royal London Asset Management (RLAM) to engage with Barclays, Lloyds, NatWest, and HSBC on the integration of the just transition into their net zero strategies.
Border to Coast's current focus in its engagement is on banks. The fund has escalated its engagement with these institutions, stating it will vote against the re-election of executives if they deem their decarbonisation strategies inadequate. This escalation was evident at the Barclays AGM, where climate protests disrupted the meeting.
Global pension funds, including Border to Coast, have backed shareholder proposals, filed by the Comptroller of the City of New York, at the AGMs of Bank of America, Goldman Sachs, and Morgan Stanley. These proposals called for the banks to disclose their annual clean energy financing ratio.
While some banks have yet to commit to taking the requested action, two unspecified banks have already made a commitment. One bank has even stated support for just transition principles, and another has included just transition ambitions in its net zero plan.
The shift in focus from oil firms to banks by investors like Border to Coast reflects a growing awareness of the role banks play in financing the fossil fuel industry and the need for them to transition towards a low-carbon economy. As the AGM season continues, it is expected that more funds will follow Border to Coast's lead in pushing for climate action from banks and oil companies.
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