AGM 2023 : First investors’ votes put aside climate

With the 2023 AGM season in full swing, the energy majors and their shareholders are confirming that the climate emergency is not a priority in their opinion. BP and Equinor’s AGMs rejected all climate-related shareholder resolutions, and Eni and ConocoPhillips’ AGMs did not even include climate in the proposed votes. These initial results are in total contradiction with the scientific recommendations and the IEA’s projections. Fortunately, some investors are leading the way and are already indicating that they will vote for climate at the upcoming Shell and TotalEnergies AGMs. Reclaim Finance calls on all investors to follow their lead and strongly condemn insufficient climate strategies. 

The energy majors have the power to make or break the Paris Agreement. However, at this stage, none of them is committed to such a trajectory and all of them continue to develop new oil and gas production and transportation projects. Moreover, all have oil and gas production targets by 2030 that are much higher than required in the IEA’s Net Zero Emissions by 2050 (NZE) scenario. For example, by planning to increase its hydrocarbon production by 48% by 2030, TotalEnergies will produce 81% more fossil fuels in 2030 than is allowed in the NZE scenario [1]. On the investment side, these companies plan to allocate less than a third of their investments in renewable energies in the coming years [2]. 

While AGMs are the key moment of the year where investors can concretely embody their promises of stewardship and encourage these companies to truly engage in their transformation, the first votes reveal the huge gap between promises and actions, with votes of complacency towards the management of the majors. 

BP’s AGM opened the ball of the majors’ AGMs. A shareholder resolution calling for alignment of scope 3 greenhouse gas emissions with the Paris Agreement was rejected, receiving only 16.75% of the votes. Incomprehensibly, even Legal & General Investment Management (LGIM) opposed it. The same resolution was filed under the coordination of the NGO Follow This at Shell, TotalEnergies, Chevron and ExxonMobil, whose AGMs will be held in the next two weeks. 

Several of these companies, including TotalEnergies, have claimed that they cannot be held responsible for the reduction of emissions related to the use of products used by its customers, corresponding to their scope 3 emissions.  However, this argument is fallacious: supply and demand are two corollary phenomena that must be acted upon simultaneously to achieve the transition objectives. The false arguments they put forward hide nothing more than their desire to make people forget their heavy responsibility in climate change and their lack of transition. TotalEnergies’ attempt to make people forget about Greenpeace’s estimate of its scope 3 emissions [3] says nothing else. 

Significantly reducing scope 3 emissions by 2030 is an obvious step encouraged by all emissions reporting and alignment frameworks. Proxy advisor ISS recommends voting for the shareholder resolution asking for alignment of scope 3 emissions at TotalEnergies’ AGM on May 26. The Church of England’s asset manager has already indicated that it will support it at Shell’s AGM on May 23: consistency would require that it does the same for TotalEnergies, Chevron and ExxonMobil. In France, CNP Assurances has indicated that it will support the resolution at the TotalEnergies’ AGM. All eyes are now on Amundi, BNP Paribas AM and AXA IM.

In the coming weeks, Shell and TotalEnergies will both present a Say on Climate vote to have shareholders approve the implementation of their climate strategy. In recent years, investors have overwhelmingly supported these resolutions, highlighting the efforts made by the majors in terms of transparency and shareholder dialogue. At a time of climate emergency, it is essential that investors change their approach and base their voting decisions on the completeness of the climate plans presented and their alignment with a 1.5°C trajectory. Since no major company is aligned with such a scenario, investors should massively oppose all their Say on Climate resolutions. 188 scientists and experts call on TotalEnergies’ shareholders to vote against its Say on Climate [4]. Here again, CNP Assurances and OFI Invest AM have committed to vote against TotalEnergies’ Say on Climate, votes that are consistent with their own commitments and voting policies.  

Some majors do not submit any climate-related resolutions to their AGMs. It was the case for the 2023 AGMs of Eni and ConocoPhilipps. Shareholders can however integrate climate into routine votes, so that the strategy and governance of the majors make climate a top priority. Reclaim Finance therefore calls on investors to vote against the renewal of board members for all majors, as well as against the remuneration of their executives which does not sufficiently integrate climate issues. 

The greenwashing and double standards have gone on long enough. Whether or not they are members of the Climate Action 100+ initiative, it is imperative that investors who claim to be climate-conscious vote in line with their promises at the next AGMs. The upcoming votes will have an important impact on the future of CA100+: while the initiative is trying to make people forget its poor results over the first 5 years, and intends to start again on a new basis over the next 5 years, it is already under attack by some members condemning the torpedoing of its objectives by some of its members. The coming AGMs will therefore be decisive.