General Electric: Climate Change Risks
WHEREAS: The increasing rate and number of climate-related disasters affecting society is causing alarms to be raised within the executive, legislative and judicial branches of government, making the corporate sector’s contribution to climate mitigation a significant policy issue;
The Commodity Futures Trading Commission’s Climate Related Risk Subcommittee recently issued a report finding that climate change poses a significant risk to, and could impair the productive capacity of, the U.S. economy;
Shareholders are increasingly concerned about material climate risk to both their companies and their portfolios and seek clear and consistent disclosures from the companies in which they invest;
In response to material climate risk, the steering committee of the Climate Action 100+ initiative (CA100+), a coalition of more than 500 investors with over $47 trillion in assets, issued a Net Zero Company Benchmark (Benchmark) calling on the largest carbon emitting companies – including our Company – to work toward reducing greenhouse gas (GHG) emissions to net zero, improving climate governance, and providing specific climate related financial disclosures;
A failure to comply with Benchmark goals and disclosures is likely to pose a material risk to our Company and its shareholders, in particular the failure to clearly disclose whether the Company has adopted net zero greenhouse gas reduction goals across its full range of emissions;
Failure to address such a critical climate issue may have a negative effect on our Company’s cost of capital and shareholders’ financial returns. BlackRock notes that investment flows into “sustainable” and climate aligned assets will drive long term outperformance relative to companies perceived as having weaker sustainability characteristics;
A core indicator of company alignment with the Paris Agreement is Indicator 1, titled “Net Zero GHG emissions by 2050 (or sooner) ambition,” which seeks disclosure on whether the company has set an ambition to achieve net zero GHG emissions by 2050 or sooner and whether any such emissions ambition statement explicitly includes scope 1, 2, and, when applicable, the most relevant scope 3 emissions (Net Zero Indicator);
While GE has committed to achieve carbon neutrality for its facilities and operations by 2030 (Scope 1 & 2), it has not reported an ambition to reduce the largest component of its GHG emissions -- its scope 3 product emissions – an important gauge of whether and how it is reducing climate risk and capitalizing on low carbon opportunities.
BE IT RESOLVED: Shareholders request the Board of Directors issue a report, at reasonable expense and excluding confidential information, evaluating and disclosing if and how the company has met the criteria of the Net Zero Indicator, or whether it intends to revise its policies to be fully responsive to such Indicator.
SUPPORTING STATEMENT: Proponents suggest, at Company discretion, the report also include any rationale for a decision not to set and disclose goals in line with the Net Zero Indicator.
Resolution Details
Company: General Electric
Lead Filers:
As You Sow
Year: 2021
Filing Date:
November 2020
Initiative(s): Climate Change Risks
Status: 98%