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Daily ESG Briefing: New York pension fund challenged 387 directors during AGM season

The latest developments in sustainable finance

The New York State Common Retirement Fund, the third largest public pension plan in the US, voted against a record number of directors this proxy season over poor climate risk oversight. The $254bn fund revealed that it took action against 387 individual directors at 72 companies, including Berkshire Hathaway, Caterpillar, Chevron and Exxon. New York State also achieved a 100% success rate on its climate-focused shareholder proposals this year, after all seven portfolio companies it filed at reached agreements with the fund around setting credible emissions reduction targets.

Schroders voted with management on more than half of the ESG-focused shareholder proposals tabled in recent months. In its latest sustainability report, the UK based asset manager, which manages around £574bn (€674bn), revealed that it backed management on 82 of the 135 “ESG-related” resolutions that went to vote in Q2. Of the 168 engagements it held during this period – including with the likes of Amazon, Bunge and Barclays – 59% were on issues of governance, with the environment the second most raised topic (10%). 56% of those engagements were in the form of an email to the company. It was also revealed that 24% of engagements from Q1 resulted in no change yet, although in 18% of cases the investor’s goal was achieved. 

More than a fifth of S&P 100 companies have lobbied against science-based climate policy, despite “the vast majority” having internal emissions reductions targets. According to a report from US responsible investment network Ceres, 92% of S&P constituents have committed to lowering emission, but just 40% are actively engaging lawmakers on the subject.  

The European trade body for accountants has published a report titled A Constructive Two-way Cooperation to Sustainability Reporting Standard-Setting, outlining the industry’s views on coordinating the work of the European Financial Reporting Advisory Group – which is developing the EU’s sustainability reporting standards – and the International Financial Reporting Standards Foundation – which plans to oversee international standards. Accountancy Europe said the report “lays down principles for cooperation and explores a collaboration on political and technical levels to secure consistency between reporting requirements”.

Moody’s has launched ESG scores for public and private SMEs, using the same methodology it uses for large-cap companies. The tool provides 56 “ESG scores and sub-scores for any given company using location, sector and size” said Moody’s. 

Portugal’s second largest bank, the state-owned Caixa Geral de Depósitos, has joined the Net Zero Banking Alliance. The UN-backed initiative launched in April with 43 members, committed to becoming carbon neutral by 2050. There are now 54 members.