Shareholder scrutiny of corporate offsetting strategies is growing as the voluntary carbon market (VCM) grows, with projections it may be worth $50 billion annually by 2030. Carbon offset advocates believe the VCM incentivizes critical investments in mitigation and adaptation, even as global efforts fail to deliver on emission reduction targets. Yet companies can face reputational and litigation risks for participating in the VCM given credibility questions. Companies can reduce the risks associated with purchasing voluntary credits by aligning their strategies with best practices and procuring third-party verified high-quality credits.
Read moreInvestors Expect Science Based GHG Targets and Reporting
Shareholders in 2023 are tightly focused on resolutions asking companies to establish science-based greenhouse gas reduction targets that cover the full value chain of emissions—and to report on them. The science is clear that companies need to rapidly act to reduce emissions to limit global warming to a 1.5°C increase in warming.
Read moreMethane Emissions Significantly Underestimated - Direct Measurement Needed
Why does methane matter? It is a powerful greenhouse gas with a global warming potential 80 times that of carbon dioxide over a 20-year period. While carbon dioxide emissions remain in the atmosphere for hundreds to thousands of years, methane breaks down in a decade – impactful while it lasts (and, so far, it’s responsible for around 30 percent of global temperature rise), but it has a shorter life in the atmosphere.
Read moreInsurance Sector Leaders and Laggards Emerging on Climate Risk
For a second year in a row, As You Sow filed climate-related proposals with three insurers -- Chubb, Traveler’s, and Berkshire Hathaway -- asking the companies to measure, disclose, and set net-zero targets for their underwriting and investing activities. The proposals last year earned majority votes – 72 percent and 56 percent, respectively at Chubb and Travelers, and a vote at Berkshire garnered 46 percent of independent voters supporting the proposal (25 percent overall vote).
Read moreClimate Related CEO Pay Incentives Lack Rigor and Specificity
In the last few years, companies have begun to use non-financial metrics more often in CEO pay packages. In 2021, 52 percent of S&P 500 companies reported including ESG metrics in compensation while 69 percent said they will be included in 2022 compensation packages.than one-third, posing the significant challenge of decoupling emissions from the sector’s growth.
Read moreCompanies Claim Transferred Emissions Reduce GHG, But All It Does Is Move Pollution Elsewhere
To address growing climate-related portfolio risk, investors increasingly expect companies to set greenhouse gas emissions reduction targets aligned with the Paris Agreement’s 1.5o goal and to report their reduction progress. Fundamental to target setting and reporting, however, is accuracy. Reported progress must reflect real-world emissions cuts. Unfortunately, this isn’t always the case.
Read moreClosing the Loop on Plastic Pollution
Many corporations are attempting to mitigate the plastic pollution crisis by reducing their use of plastics, yet few have committed to tackling the crisis in its entirety by taking accountability for what actually happens to their packaging at its end of life.
Read moreBoard Diversity Disclosure Identifies Leaders and Laggards
Boards are becoming more diverse and detailed disclosure provides a critical window into progress. Boards that are both diverse and inclusive offer multiple ways to look at strategy and risk and a lower likelihood of groupthink. Their selection process extends beyond the board’s immediate network and diverse boards connect companies to communities that represent large swaths of its customers, employees and/or business locations. For investors and also for researchers, the more specific the company’s disclosures, the easier it is to assess board composition compared to the demographics of key stakeholders and society at large.
Read moreEmployees Unaware of Climate Risk in Retirement Plans
One hundred million Americans have invested more than $10 trillion in retirement savings that likely are not aligned with their values. Many corporations strive to reduce material risk for all stakeholders by becoming more environmentally and socially responsible. But if they do not consider climate-related financial risks, most invest employees’ hard-earned savings in oil, coal-fired utilities and agribusinesses involved in deforestation, which means employees’ savings fuel climate change.
Read moreSteel Industry Net Zero Targets Key for Decarbonization
Reducing GHG emissions from steel, one of the most widely used industrial materials, is a critical part of the global challenge of maintaining global temperatures to 1.5˚C. According to the U.S. Energy Information Administration, the iron and steel sector accounts for 7 percent of global CO2 emissions due to its significant use of fossil fuels, heavy industrial process emissions, and power use. By 2050, demand for steel is expected to increase by more than one-third, posing the significant challenge of decoupling emissions from the sector’s growth.
Read moreCompanies Taking a Closer Look at How Racial Inequity Affects Their Workers, Customers and Shareholders
The third anniversary of the murder of George Floyd at the hands of the Minneapolis police officers is fast approaching. We are reminded of the work we began nearly three years ago by filing Racial Equity Audit (REA) shareholder proposals and how much work remains. The police killings of Black people across the U.S. continue to galvanize the movement for racial justice, and corporations continue to be held accountable socially and legally for their role in furthering the economic and political repression of nonwhite communities.
Read moreESG Triggers the Right
Republican politicians are placing ESG on the list of grievances and conspiracies they serve up to their base as they try to turn ESG into the next critical race theory (CRT). One activist who was instrumental in convincing the Republican base that CRT is an ominous threat to their existence is heavily involved in the anti-ESG effort.
Read moreEnding Child Labor in Cocoa Production
In 2023, the chocolate industry is still not free from child labor. Millions of children are being robbed of their childhood and right to education while working on farms to meet corporate demand for cheaply sourced cocoa. Since this is an industry-wide issue, corporations tend to place the onus on the industry at large rather than assume liability individually.
Read moreMeta Fails to Address Online Child Safety Risks
The internet was not developed with children in mind. There is no better example of this than Meta, which intended its platforms as a place where people could connect with friends and family. Instead, they have become a dangerous playground for children.
Read moreCorporate Efforts on Climate Must Include Lobbying
While climate change always seems to bring troubling news, few reports in the past year are more compelling than those from scientists saying our ability to reach the Paris Agreement’s goal of 1.5˚C above pre-industrial levels is pretty much out of reach.
Read moreShareholders and Local Communities Join to Demand Racial and Environmental Justice
Often, companies have no “business-case rationale” to listen to the communities negatively affected by their operations and no incentives to act. As shareholders, we have legal standing to engage the executives and boards of these public companies.
Read moreIncrease in EEO-1 Data Reporting Shows Positive Link Between Diversity and Financial Performance
A report released by As You Sow and Whistle Stop Capital in November 2022 assessed the data from 277 EEO-1 reports, looking at the link between workforce diversity and corporate financial performance. In line with our hypothesis and others’ previous research, the analysis found that financial metrics, like return on equity and net profit, were associated with higher levels of diversity in management.
Read moreIllegally Captured Primates Used in Animal Testing Pose Health and Investor Risks
Animal testing behemoth Charles River Laboratories is one of the largest importers of monkeys into the U.S., each year bringing in thousands of monkeys – mostly long-tailed macaques – from Southeast Asia and Mauritius. The International Union for Conservation of Nature has classified long-tailed macaques as “endangered,” identifying the U.S. experimentation industry as a major driver pushing these monkeys toward extinction.
Read moreRailroad Workers' Lack of Paid Sick Leave Puts Employees, Public and Investors at Risk
Impact Shares considers paid sick leave (PSL) to represent an important human capital investment critical to investors, as well as a racial and gender equity concern. Filing a shareholder proposal at Norfolk Southern railways requesting that the company adopt a PSL policy as a standard benefit was the first step in leveraging our position as an ETF issuer representing leading social and environmental advocacy organizations.
Read moreA Framework for Evaluating Goals and Risks of Corporate Political Spending
Companies today face a high-risk landscape for their political spending and its impact. The crisis that confronts U.S. democracy and the gridlock blocking action on a broad range of issues from climate change to voting, women’s reproductive rights, guns and even democracy itself has put front and center the role of company political spending in contributing to the breakdown.
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