Rhode Island’s Magaziner gets emissions targets agreement with agri giant Archer Daniels Midland

Company agrees to assess feasibility of targets as proxy run-up begins in earnest

Rhode Island State Treasurer Seth Magaziner has withdrawn a shareholder resolution at Archer Daniels Midland (ADM), following concessions from the US agricultural processing giant on its greenhouse gas emissions targets.

The company has agreed to assess the “feasibility” of adopting company-wide greenhouse gas emissions targets, including increasing its use of renewable energy, following engagement from investors.

Following this feasibility study, ADM will produce a report outlining its findings for review by the company’s board before the end of 2020, that report will then be made publicly available on the company’s website.

“Pension funds are long-term investors,” said Treasurer Magaziner. “Companies, especially those as large as Archer Daniels Midland, must have a plan to adapt their business model to reduce dependence on fossil fuels. A transition to renewable energy can help stabilize and reduce energy costs – freeing up corporate resources that can be invested for sustainable growth”.

Magaziner, a former equities analyst at Boston-based SRI firm Trillium turned Democrat politician, was this month appointed Chair of the National Association of State Treasurers’ Pension and Trust Investment Committee.

The appointment followed Magaziner’s re-election at the helm of Rhode Island’s $8bn public pension pot in November.

Speaking to RI in July, Magaziner said that the smallest state in the Union is seeking to become “more thoughtful about integrating ESG into our due diligence process [and] our manager due diligence process”.

Last October, Magaziner announced Rhode Island had filed a shareholder resolution at Facebook calling on the scandal-hit social media company to appoint an independent Chair, a position currently held by founder and CEO Mark Zuckerberg. It follows the disclosure by the company that nearly thirty million users may have had their data stolen.The withdrawn resolution at ADM is one of a number by US public pension funds and state treasurers ahead of this year’s proxy season, continuing a trend from last year.

Californian pension giant CalPERS has withdrawn its resolution on “physical and transition risks” at Southern Copper Corp. following commitments from the US mining firm, according to the Ceres database.

The Office of Illinois State Treasurer, Michael Frerichs has also withdrawn two of the five resolutions it filed at US companies calling on them to produce annual sustainability reports. Commitments from real estate investment trust, Host Hotels & Resorts and communications infrastructure specialist, Crown Castle International Corp. prompted Frerichs’ office to withdraw.

According to the Ceres website, the Office of the New York State Comptroller, Thomas DiNapoli has withdrawn at least three ESG orientated resolutions it filed this proxy season, following commitments from companies.

The $207bn fund withdrew its resolution requesting a 2°C analysis and strategy from US oil firm Concho Resources. It also withdrew resolutions on greenhouse gas reduction targets filed at US retailer Dollar Generation Corporation and Texan energy firm Vistra Energy Corp.

Neighbouring New York City Comptroller, Scott Stringer, who oversees the City’s $191bn public pension assets, currently has resolutions on climate lobbying filed at US motor giants Ford and General Motors.

Philadelphia’s Public Employees Retirement System has also filed on climate lobbying with a resolution at US oil giant Chevron Corporation.

It comes as Exxon has challenged investors’ climate resolution with the SEC.