Finance | Interfaith Center on Corporate Responsibility

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<strong>Company:</strong>
<p>Amgen Inc.</p>
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<strong>Year:</strong>
<p>2025 </p>
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<strong>Issue Area:</strong>
<p>Finance </p>
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<strong>Focus Area:</strong>
<p>Corporate Taxation/Policies </p>
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<strong>Status:</strong>
<p>Filed</p>
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<h2>Resolution Text</h2>
<p class=”p1″><strong>RESOLVED: </strong>Shareholders of Amgen Inc. (“Amgen”) request that the Board of Directors issue a tax transparency report, at reasonable expense and excluding confidential and proprietary information, prepared in consideration of the indicators and guidelines set forth in the Global Reporting Initiative’s (“GRI’s”) Tax Standard, as described below.</p>
<p class=”p2″>Supporting Statement</p>
<p class=”p3″>Amgen’s tax practices and failure to adequately disclose potential tax liabilities to shareholders, which resulted in unanticipated tax charges of as much as $10.7 billion and a class action lawsuit,1 threaten to harm our company’s reputation. Proactive disclosure is required to bolster Amgen’s reputation and to prevent potential future losses.</p>
<p class=”p3″>Amgen’s failure to disclose revenues or profits in non-US markets and to disaggregate foreign tax payments, challenges investors’ ability to fully evaluate the risks of taxation reforms or determine whether Amgen’s tax practices promote long term value creation. Amgen’s alleged profit shifting to Puerto Rico – a foreign jurisdiction for US federal tax purposes – is central to current I.R.S. tax charges. Since 2022, the US Senate Finance Committee’s Chair has requested tax transparency from Amgen.2</p>
<p class=”p3″>The Organization for Economic Cooperation and Development’s (“OECD’s”) global tax reforms are now being implemented in many countries. The US Financial Accounting Standards Board has adopted significant new tax reporting requirements for 2025. A European Union directive to implement a form of public, country by country reporting (“CbCR”) went into effect in 2024.3 Australia recently passed legislation to require more extensive public CbCR in key tax haven jurisdictions following the GRI Tax Standard.4 Amgen will be required to publicly report on tax paid in many jurisdictions where it has subsidiaries.</p>
<p class=”p3″>The report requested in this proposal would bring Amgen’s disclosures in line with over a quarter of major companies that already report using the GRI Tax Standard.5 The additional reporting burden is negligible as Amgen already reports similar confidential CbCR information shared with OECD tax authorities.</p>
<p class=”p3″>Global investors representing over $10 trillion actively support the GRI Tax Standard.6 It was developed in response to investor concerns regarding inadequate corporate tax transparency, the impacts of tax avoidance on inequality, and governments’ ability to fund services and support sustainable development.7 GRI 207-1, 207-2, and 207-3 require companies to disclose their approach to tax governance, control, and risk management; stakeholder engagement; and management of tax concerns, respectively. 207-4 requires CbCR of financial information including revenues, profits and losses, and tax payments in each jurisdiction.8 GRI 207 also recommends disclosing “industry-related and other taxes or payments to governments.”</p>
<p class=”p2″>Profit shifting by corporations is estimated to cost the US government $70–100 billion annually.9 Globally, OECD data suggests annual revenue losses of $245 billion.10 Without proactive efforts to increase transparency, additional reforms and ongoing scrutiny of Amgen’s tax practices will continue to put shareholders at risk.</p>
<p class=”p1″>1 https://news.bloombergtax.com/tax-insights-and-commentary/amgens-10-7-billion-case-is-call-for-transfer-prici ng-clarity.</p>
<p class=”p3″>2 https://www.finance.senate.gov/chairmans-news/wyden-makes-final-request-to-amgen-for-voluntary-complianc e-in-pharma-tax-investigation.</p>
<p class=”p4″>3 https://kpmg.com/us/en/taxnewsflash/news/2024/11/tnf-eu-updated-public-cbc-reporting-forms.html.</p>
<p class=”p4″>4 https://www.pwc.com.au/tax/tax-alerts/australian-public-country-by-country-reporting-laws-passed.html.</p>
<p class=”p4″>5 https://www.globalreporting.org/news/news-center/one-in-four-major-companies-report-with-gri-tax-standard/.</p>
<p class=”p3″>6 https://thefactcoalition.org/new-analysis-shows-investors-representing-10t-support-greater-tax-transparency-for- large-multinationals/.</p>
<p class=”p4″>7 https://www.globalreporting.org/news/news-center/backing-for-gri-s-tax-standard/.</p>
<p class=”p1″>8 https://www.globalreporting.org/standards/media/2482/gri-207-tax-2019.pdf</p>
<p class=”p2″>9 https://thefactcoalition.org/trillions-at-stake-behind-the-numbers-at-play-in-u-s-international-corporate-tax-refor m/.</p>
<p class=”p4″>10 https://www.washingtonpost.com/us-policy/2020/11/19/global-tax-evasion-data/.</p>

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<div class=”views-field views-field-nothing”><span class=”field-content”> Armando Pintado</span></div><div class=”views-field views-field-title views-field-field-shareholder”><span class=”field-content”>Service Employees International Union (SEIU)</span></div>
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<strong>Company:</strong>
<p>Bristol-Myers Squibb Company</p>
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<strong>Year:</strong>
<p>2025 </p>
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<strong>Issue Area:</strong>
<p>Finance </p>
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<strong>Focus Area:</strong>
<p>Corporate Taxation, Corporate Taxation/Policies, Tax Havens </p>
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<strong>Status:</strong>
<p>Filed</p>
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<h2>Resolution Text</h2>
<p><strong>RESOLVED</strong>: Bristol-Myers Squibb (BMY) shareholders request the Board of Directors issue a tax transparency report to shareholders, at reasonable expense and excluding confidential information, prepared in consideration of the indicators and guidelines outlined in the Global Reporting Initiative’s (GRI) Tax Standard.</p>
<p><strong>Supporting Statement </strong></p>
<p>BMY’s tax practices and failure to disclose has harmed our company’s reputation, resulting in an investigation into whether BMY was using an “abusive” tax shelter that would cheat the United States out of $1.4 billion in taxes.1 Tax transparency is required to restore BMY’s reputation and prevent future losses. </p>
<p>BMY does not disclose revenues or profits in non-US markets, and foreign tax payments are not disaggregated, challenging investors’ ability to evaluate the risks to BMY of taxation reforms or whether BMY is engaged in responsible tax practices that ensure long-term value creation. BMY’s alleged profit shifting to Ireland is central to current scrutiny involving its tax practices.2 </p>
<p>Global OECD tax reforms are now implemented worldwide. There are growing demands for the United Nations to play a stronger role, ensuring multinationals pay taxes where profits are earned. The Financial Accounting Standards Board adopted new reporting requirements on tax payments, effective in 2025. A European Union directive to implement country-by-country reporting (CbCR) is effective in 2024.3 Similar legislation is expected in Australia in the same timeframe. </p>
<p>Unchecked corporate tax avoidance poses a risk to the long-term portfolios of diversified investors. While such activities may help one company, they can cause externalities for other companies, taxpayers, consumers, and workers — ultimately hampering economic value creation and portfolio growth upon which long-term diversified investors depend.4</p>
<p>The GRI Standards is the world’s most utilized reporting standard, actively supported by global investors representing over $10 trillion.5 The GRI Tax Standard was developed in response to investor concerns regarding the lack of corporate tax transparency and the impact of tax avoidance on governments’ ability to fund services and support sustainable development.6 It is the first comprehensive, global standard for public tax disclosure. It requires public reporting of a company’s business activities, including revenues, profits and losses, and tax payments within each jurisdiction.7 </p>
<p>Profit shifting by corporations is estimated to cost the US government $70 – 100 billion annually.8 The OECD estimates annual revenue losses of $100 – 240 billion globally.9 The PRI states that tax avoidance is a key driver of global inequality.10 Further reforms and greater international scrutiny of BMY’s tax practices will continue to put shareholders at risk without greater transparency. </p>
<p>This proposal would bring BMY’s disclosures in line with leading companies using the Tax Standard.11 The reporting burden is negligible, since BMY already reports similar confidential CbCR information shared with OECD tax authorities.</p>
<p>1https://www.nytimes.com/2021/04/01/business/bristol-myers-taxes-irs.html</p>
<p>2https://www.investigate-europe.eu/posts/deadly-prices-pharma-firms-stash-profits-in-europes-tax-havens-as-patients struggle-with-drug-prices</p>
<p>3https://www.internationaltaxreview.com/article/b1vf7yc65qpzcd/this-week-in-tax-eu-on-track-for-public-cbcr-by-2023 </p>
<p>4https://theshareholdercommons.com/wp-content/uploads/2024/09/Sample-Text_Portfolio-focused-Proxy Actions_2024September.pdf </p>
<p>5https://assets.kpmg/content/dam/kpmg/xx/pdf/2020/11/the-time-has-come.pdf 6https://www.globalreporting.org/about-gri/news-center/backing-for-gri-s-tax-standard/ 7https://www.globalreporting.org/standards/standards-development/topic-standard-for-tax/ 8https://thefactcoalition.org/trillions-at-stake-behind-the-numbers-at-play-in-u-s-international-corporate-tax-reform/ </p>
<p>9https://www.washingtonpost.com/us-policy/2020/11/19/global-tax-evasion-data/ </p>
<p>10 https://www.globalreporting.org/about-gri/news-center/backing-for-gri-s-tax-standard/ </p>
<p>11 https://www.globalreporting.org/about-gri/news-center/momentum-gathering-behind-public-country-by-country-tax reporting/</p>
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<div class=”views-field views-field-nothing”><span class=”field-content”> James McRitchie</span></div><div class=”views-field views-field-title views-field-field-shareholder”><span class=”field-content”>Corporate Governance</span></div>
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<strong>Company:</strong>
<p>Uber Technologies</p>
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<strong>Year:</strong>
<p>2025 </p>
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<strong>Issue Area:</strong>
<p>Finance, Human Rights & Worker Rights </p>
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<strong>Focus Area:</strong>
<p>Financial Disclosure </p>
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<strong>Status:</strong>
<p>Filed</p>
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<h2>Resolution Text</h2>
<p>RESOLVED: Shareholders ask the UBER Board of Directors to disclose information concerning the distribution of “gross bookings” between recipients and purposes served. </p>
<p>SUPPORTING STATEMENT: In an August 2020 New York Times column, UBER CEO Dara Khosrowshahi wrote: “Since the first UBER trip 10 years ago, an existential question has shadowed us: Do we treat drivers well?” UBER’s treatment of drivers has been a controversial topic inspiring legislative efforts to protect drivers in multiple states and cities. Internationally, disputes about the treatment of drivers have led courts to declare UBER drivers to be employees, contrary to UBER’s assertion that drivers were self-employed. Unfortunately for UBER shareholders, the company fails to disclose the metrics necessary to answer this “existential” question because UBER does not classify payments by platform users as revenue. Instead, such payments are (mostly) classified as “gross bookings,” from which guaranteed and most incentive payments to drivers and reimbursement payments to restaurants, as well as some insurance payments, are deducted to determine revenue. Unlike rival Lyft, UBER’s large delivery segment prevents shareholders from calculating either per-trip prices for platform users or per-trip pay for drivers from the gross bookings and company-wide trip data UBER does disclose. UBER’s business model is thus unusually opaque to readers of its financial statements who cannot resolve debates over the size of UBER’s “take rate,” how driver pay has changed over time, and whether drivers can earn a living income. </p>
<p>This opacity has only become more frustrating since UBER introduced “upfront” or “guaranteed” fares for drivers in fall 2022. Since then, UBER has achieved positive operating earnings in six consecutive quarters, the first time that has happened. But without visibility into how drivers are paid, the investing public is unable to meaningfully assess the durability of this achievement. Furthermore, many drivers have become frustrated with what they report as reduced pay resulting from the switch to upfront fares. Without transparent reporting from UBER, investors cannot assess the accuracy of these claims, and hence cannot estimate whether driver frustration may lead to further regulatory efforts or otherwise undermine UBER’s recent accomplishments.</p>
<p>CEO Khosrowshahi was right in 2020: driver pay is an existential question for UBER, because it goes to the heart of its business model and its ability to operate profitably. Shareholders deserve enough transparency to assess UBER’s answer to this question for themselves.</p>

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<div class=”views-field views-field-nothing”><span class=”field-content”> Mikail Husain</span></div><div class=”views-field views-field-title views-field-field-shareholder”><span class=”field-content”>SOC Investment Group</span></div>
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Resolution Details

Company:

Kosmos Energy

Year:

2024

Issue Area:

Finance

Focus Area:

Corporate Taxation/Policies

Status:

Filed

Resolution Text

RESOLVED: Shareholders request that the Board of Directors issue a tax transparency report to shareholders, at reasonable expense and excluding confidential information, prepared in consideration of the indicators and guidelines set forth in the Global Reporting Initiative’s (GRI) Tax Standard.

Supporting Statement

Tax transparency is increasingly important to investors. The PRI, representing investors with $89 trillion assets under management, states that, “For investors, tax risk is financially material at the individual asset level. With tightening regulations and shifting societal expectations, tax avoidance activities of multinational enterprises have attracted large fines and highlighted growing reputational, governance, and earnings risks.”1 96% of US companies expect more tax disputes as governments become more rigorous in tax examinations.2

In 2021, 136 countries signed a global tax reform framework.3 National and regional-level agreements also demonstrate growing consensus around the importance of tax disclosures: the proposed Disclosure of Tax Havens and Offshoring Act, passed by the House of Representatives, requires public country-by-country reporting (CbCR) of financial (including tax) data by SEC-registered companies.4 In November 2021, the European Union approved a directive to implement public CbCR for large multinationals operating there.5 In April 2023, the Australian government released draft legislation that requires CbCR for any large multinational doing business in Australia.6

Though a leader in other types of transparency, Kosmos does not disclose financial data with adequate levels of disaggregation to understand its operations and contextualize its tax and other payments by country.7 This challenges investors’ ability to evaluate the liability of tax reforms or whether Kosmos engages in responsible tax practices. This risks the company’s reputation and puts investors at risk of significant cost in tax challenges. For example, Kosmos is being challenged by the Ghana Revenue Authority for underpayment of certain taxes.8 While the company says that the claim lacks merit, investors do not have the data necessary to verify this.9

The GRI Standards are the world’s most utilized corporate reporting standard.10 The GRI Tax Standard – GRI 207 – is the first comprehensive, global standard for public tax disclosure. It includes four components. GRI 207-1, 207-2, and 207-3 require companies to disclose their approach to tax; their tax governance, control, and risk management; stakeholder engagement and management of tax concerns. 207-4 requires CbCR of financial information, including revenues, profits and losses, and tax payments within each jurisdiction.11 GRI 207 also recommends disclosing “industry-related and other taxes or payments to governments.”

A GRI-aligned tax transparency report would bring Kosmos in line with peer companies12 that report using GRI 207.13 Kosmos already reports CbCR information to OECD tax authorities privately, so any increased burden is negligible.

1 https://www.unpri.org/download?ac=15325#:~:text=Some%20investors%20believe%20that%20tax,good%20risk%20management%20and%20governance.&text=Prudent%20tax%20planning%20as%20the%20basis%20for%20tax%20management.

2 https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Tax/gx-beps-global-survey-summary-results-2022.pdf

3 https://www.oecd.org/tax/international-community-strikes-a-ground-breaking-tax-deal-for-the-digital-age.htm

4 https://www.congress.gov/bill/117th-congress/house-bill/3007 5 https://www.internationaltaxreview.com/article/b1vf7yc65qpzcd/this-week-in-tax-eu-on-track-for-public-cbcr-by-2023

6 https://treasury.gov.au/consultation/c2023-383896

7 https://www.kosmosenergy.com/wp-content/uploads/2023/06/2022-Payments-to-Government.pdf; https://www.kosmosenergy.com/transparency/

8 https://investors.kosmosenergy.com/static-files/985f05d7-645f-4c32-a398-ca7fdc38e951, p. 45

9 https://ghstandard.com/goldfields-kosmos-dispute-tax-bills-imposed-by-gra/3319/

10 https://assets.kpmg/content/dam/kpmg/xx/pdf/2020/11/the-time-has-come.pdf

11 https://www.globalreporting.org/standards/media/2482/gri-207-tax-2019.pdf

12 https://www.hess.com/sustainability/how-we-operate/tax-practices; https://reports.shell.com/tax-contribution-report/2020/our-tax-data.html; https://s24.q4cdn.com/382246808/files/doc_downloads/2022/sustainability/newmont-2021-tax-report.pdf; https://www.bp.com/en/global/corporate/sustainability/our-approach-to-sustainability/tax-transparency.html; https://reports.shell.com/tax-contribution-report/2020/; https://www.eni.com/assets/documents/eng/reports/2020/Country-by-Country-2020_ENG.pdf; https://totalenergies.com/sites/g/files/nytnzq121/files/documents/2022-03/Tax_transparency_report_2019_2020.pdf

13 https://www.globalreporting.org/news/news-center/momentum-gathering-behind-public-country-by-country-tax-reporting/

Resolution Details

Company:

ConocoPhillips

Year:

2024

Issue Area:

Finance

Focus Area:

Corporate Taxation, Tax Havens

Status:

Challenged

Resolution Text

RESOLVED: Shareholders request that the Board of Directors issue a tax transparency report to shareholders, at reasonable expense and excluding confidential information, prepared in accordance with the recommendations set forth in the Global Reporting Initiative’s (GRI) Tax Standard, including disclosure of payments to governments.

Supporting Statement

In 2021, 136 countries signed a global tax reform framework.3 The proposed Disclosure of Tax Havens and Offshoring Act, passed by the House of Representatives, would require public country-by-country reporting (CbCR) of tax data by SEC-registered companies.4 Further, in November 2021, the European Union approved a directive to implement CbCR for large multinationals.5 In April 2023, the Australian government released draft legislation that requires CbCR for large multinationals doing business in Australia.6

ConocoPhillips does not disclose revenues or profits in non-US markets, nor foreign tax payments, with adequately disaggregated data. This challenges investors’ ability to evaluate the risks of taxation reforms, and whether ConocoPhillips’s tax practices ensure long term value creation. Tax authorities across the globe have repeatedly challenged ConocoPhillips’s taxation approach, producing significant costs for the company.7 In 2020, for example, ConocoPhillips settled a $179 million tax bill with Vietnam.8 Despite this, ConocoPhillips is retreating from its transparency commitments, including withdrawal from the Extractive Industries Transparency Initiative, limiting investor access to details about payments to governments around the world.9

While ConocoPhillips’ subsidiaries file statutory reports for operations in Australia, Colombia, Malaysia, the Netherlands, Norway, Singapore, and the United Kingdom, CbCR cannot be fully useful if it only includes select jurisdictions.

The GRI Standards are the world’s most utilized corporate reporting standard.10 The GRI Tax Standard is the first comprehensive global standard for public tax disclosure. It includes four components. GRI 207-1, 207-2, and 207-3 require companies to disclose their approach to tax governance, control, and risk management; stakeholder engagement; and management of tax concerns. 207-4 requires CbCR of financial information including revenues, profits and losses, and tax payments in each jurisdiction.11 GRI 207 also recommends disclosing “industry-related and other taxes or payments to governments.”

A GRI-compliant tax transparency report would bring ConocoPhillips in line with peer companies – including many in the oil, gas, and mining industries12 – who report using GRI 207.13 ConocoPhillips already reports CbCR information to OECD tax authorities privately, so any increased burden is negligible.

2 https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Tax/gx-beps-global-survey-summary-results-2022.pdf

3 https://www.oecd.org/tax/international-community-strikes-a-ground-breaking-tax-deal-for-the-digital-age.htm

4 https://www.congress.gov/bill/117th-congress/house-bill/3007

5 https://www.internationaltaxreview.com/article/b1vf7yc65qpzcd/this-week-in-tax-eu-on-track-for-public-cbcr-by-2023

6 https://treasury.gov.au/consultation/c2023-383896

7 https://www.afr.com/markets/equity-markets/conocophillips-settles-tax-disputes-with-timorleste-20160218-gmwzg8; https://law.justia.com/cases/federal/appellate-courts/ca10/12-5170/12-5170-2014-03-12.html; https://tpguidelines.com/norway-vs-conocophillips-skandinavia-as-march-2022-court-of-appeal-case-no-lg-2021-38180/

8 https://www.theguardian.com/global-development/2018/aug/15/oil-firms-use-secretive-court-hearing-in-bid-to-stop-vietnam-taxing-their-profits; https://www.jtl.columbia.edu/bulletin-blog/unclear-regulations-and-opportunistic-behavior-capital-gains-from-vietnamese-assets; https://globalarbitrationreview.com/conoco-settles-tax-dispute-vietnam; https://www.sec.gov/Archives/edgar/data/1163165/000119312520039954/d875559d10k.htm

9 https://eiti.org/news/conocophillips-ceases-be-eiti-supporting-company

10 https://assets.kpmg/content/dam/kpmg/xx/pdf/2020/11/the-time-has-come.pdf

11 https://www.globalreporting.org/standards/media/2482/gri-207-tax-2019.pdf

13 https://www.globalreporting.org/news/news-center/momentum-gathering-behind-public-country-by-country-tax-reporting/

Resolution Details

Company:

Exxon Mobil Corporation

Year:

2024

Issue Area:

Finance

Focus Area:

Corporate Taxation, Tax Havens

Status:

Challenged

Resolution Text

Supporting Statement

Tax transparency is increasingly important to investors. The PRI, representing investors with $89 trillion assets under management, states that, “For investors, tax risk is financially material at the individual asset level. With tightening regulations and shifting societal expectations, tax avoidance activities of multinational enterprises have attracted large fines and highlighted growing reputational, governance, and earnings risks.”1 Economic challenges have increased government concern about corporate tax avoidance, and 96% of US companies expect more tax disputes as governments become more rigorous in tax examinations.2

In 2021, 136 countries signed a global tax reform framework.3 The proposed Disclosure of Tax Havens and Offshoring Act, passed by the House of Representatives, would require public country-by-country reporting (CbCR) of financial (including tax) data by SEC-registered companies.4 Further, in November 2021, the European Union approved a directive to implement public CbCR for large multinationals operating there.5 In April 2023, the Australian government released draft legislation that would, if legislated, require CbCR for any large multinational doing business in Australia.6

ExxonMobil does not disclose revenues or profits in non-US markets, nor foreign tax payments, with adequately disaggregated data. This challenges investors’ ability to evaluate the risks of taxation reforms, or whether ExxonMobil engages in responsible tax practices that ensure long term value creation. Tax authorities across the globe have repeatedly challenged ExxonMobil’s taxation approach, producing significant costs for the company.7 For example, ExxonMobil was recently issued a $215 million fine by Russian authorities for their Sakhalin 1 oil and gas project for alleged non-payment of back taxes.8

The GRI Standards are the world’s most utilized corporate reporting standard.9 The GRI Tax Standard – GRI 207 – is the first comprehensive, global standard for public tax disclosure. It includes four components. GRI 207-1, 207-2, and 207-3 require companies to disclose their approach to tax; their tax governance, control, and risk management; and their stakeholder engagement and management of concerns related to tax, respectively. 207-4 requires public CbCR of certain company financial information, including revenues, profits and losses, and tax payments within each jurisdiction.10 GRI 207 also recommends disclosing “industry-related and other taxes or payments to governments.” Given the significance of other project-specific payments to governments in the oil and gas sector, GRI identifies disclosures of all significant project-level payments to governments as relevant for that sector in reporting under the Tax Standard.11

A GRI-aligned tax transparency report would bring ExxonMobil in line with peer companies – including many in the oil, gas, and mining industries12 – that report using GRI 207.13 ExxonMobil already reports CbCR information to OECD tax authorities privately, so any increased burden is negligible.

2 https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Tax/gx-beps-global-survey-summary-results-2022.pdf

3 https://www.oecd.org/tax/international-community-strikes-a-ground-breaking-tax-deal-for-the-digital-age.htm

4 https://www.congress.gov/bill/117th-congress/house-bill/3007

5 https://www.internationaltaxreview.com/article/b1vf7yc65qpzcd/this-week-in-tax-eu-on-track-for-public-cbcr-by-2023

6 https://treasury.gov.au/consultation/c2023-383896

7 https://www.theguardian.com/business/2018/jul/03/exxonmobil-spent-10m-fighting-australian-tax-office; https://www.bloomberg.com/news/articles/2018-08-09/exxon-loses-fight-for-337-million-tax-refund-from-u-s; https://www.france24.com/en/20170914-exxonmobil-russia-settle-tax-row

8 https://www.upstreamonline.com/politics/exxonmobil-hit-with-215-million-court-fine-in-russian-tax-dispute/2-1-1397064

9 https://assets.kpmg/content/dam/kpmg/xx/pdf/2020/11/the-time-has-come.pdf

Resolution Details

Company:

American International Group, Inc. (AIG)

Year:

2024

Issue Area:

Climate Change, Finance

Focus Area:

Climate Financing

Status:

Filed

Resolution Text

WHEREAS: The Intergovernmental Panel on Climate Change has advised that greenhouse gas (GHG) emissions must be halved by 2030 and reach net-zero by 2050 in order to limit global warming to 1.5°C and avoid increasingly severe physical, transition, and systemic risks for companies and investors.

Property and casualty insurers have a unique relationship to climate risk. They underwrite policies for and invest in the fossil fuel industry, which is responsible for ~90% of annual global carbon dioxide emissions, while simultaneously writing policies meant to protect their customers’ homes and businesses from the impacts of climate driven catastrophes.1 The worsening climate crisis has provoked more frequent and severe catastrophes, harming insurers who then impose further costs onto already climate impacted customers.2

AIG committed to reaching net-zero GHG emissions across its underwriting and investment portfolios by 2050 and committed to using science-based emissions reduction targets, aligning with the latest climate science to meet the goals of the Paris Agreement. In doing so, it recognizes the business imperative of reducing GHG emissions and preparing for the transition to a low carbon economy.

Recent high profile reversals of company commitments to set science-based targets have prompted investors to seek assurance that companies have comprehensive strategies sufficient to meet their stated targets. Developing a climate transition plan is an emerging best practice that meets this
need. Transition plans are forward looking, near- and medium-term sets of actions a company will take to align its GHG emissions, business strategies, governance structures, and external policy engagement with a 1.5°C scenario in a just and equitable manner.

Over 4,100 organizations disclosed to CDP that they have 1.5°C aligned transition plans; however, only 45 percent were public, and only 12.6 percent covered key elements of credible transition plans.3 By preparing and publishing a credible transition plan, companies can mitigate reputational and regulatory risks and maintain investor confidence.

RESOLVED: Shareholders request AIG issue a climate transition plan, above and beyond existing disclosures, describing how it intends to align its operations and full value chain emissions with the ambition of limiting global temperature increase to 1.5°C. The plan should be published on a reasonable timeline and at reasonable expense, exclude confidential information, and detail progress and any plan updates on an annual basis.

SUPPORTING STATEMENT: In developing and implementing the plan, we recommend, at management’s discretion:

• Providing forward looking, near-term and medium-term strategies, metrics, and milestones for achieving the Company’s GHG emissions reduction targets across decarbonization, governance, policy advocacy, and just transition components;
• Considering transition plan guidance by advisory groups such as the Transition Plan Taskforce, United Nations’ High Level Expert Group on Net Zero Emissions, and We Mean Business Coalition.

1 https://www.un.org/en/climatechange/science/causes-effects-climate-change
2 https://www.nytimes.com/2023/10/12/realestate/as-natural-disasters-get-worse-so-do-home-insurancepremiums.
html
3 https://cdn.cdp.net/cdpproduction/
cms/reports/documents/000/006/785/original/Climate_transition_plan_report_2022_%2810%29.pdf?
1676456406. Pg7.

Resolution Details

Company:

J.P. Morgan Chase & Co.

Year:

2024

Issue Area:

Climate Change, Finance

Focus Area:

Climate Financing, Environmental Justice, Indigenous Peoples/FPIC

Status:

Filed

Resolution Text

WHEREAS: The UN Declaration on the Rights of Indigenous Peoples and International Labour Organization Convention 169 concerning Indigenous and Tribal Peoples in Independent Countries are internationally-recognized standards for Indigenous Peoples’ rights.[1] Violation of these rights presents risks for JPMorgan that can adversely affect shareholder value, including reputational damage, project disruptions, and civil and criminal liability.[2] JPMorgan has a history of financing projects and companies that violate Indigenous rights, including bankrolling the Dakota Access pipeline in 2016[3] and providing $1.8 billion to Enbridge between 2016 and 2020 to enable the widely opposed Enbridge Line 3 and Line 5 tar sands pipeline reroutes.[4]

Indigenous leaders from the Great Lakes tribes have called Enbridge’s Line 5 pipeline reroute “an act of cultural genocide.”[5] A 2022 ruling found that Line 5 was operating illegally on Bad River Band territory since 2013.[6] Michigan’s twelve federally recognized Tribal Nations requested President Biden to decommission Line 5 in 2021,[7]noting Enbridge’s deceptive tactics, poor environmental track record, and risk of “catastrophic damage” to Indigenous rights.[8] Companies like Enbridge, financed by JPMorgan, consistently fail to meet the international standard of free, prior, and informed consent (FPIC) with affected tribes.[9]

JPMorgan is additionally the subject of ongoing protests for its role as the largest financier of oil and gas operations in the Amazon rainforest that pose “an existential threat” to Indigenous Peoples.[10] For example, JPMorgan finances Gran Tierra Energy, which has been connected to Indigenous Rights violations of the Inga and Pastos people in Columbia since 2012.[11] Despite making commitments to protect UNESCO sites,[12] JPMorgan finances PetroAmazonas, which operates in the Yasuni UNESCO Reserve despite clear Indigenous opposition.[13] Ecuadorian courts ruled in 2019 that Waorani Peoples were not adequately consulted.[14] In August 2023, a referendum vote opted to halt drilling in Yasuni Park, which the company estimates will cost $1.2 billion in income.[15]

JPMorgan faces reputational risk if its climate commitments are discredited by its own financing activities.[16] JPMorgan’s human rights and risk management policies do not clearly define FPIC, nor include guidance on how JPMorgan addresses companies with track records of violating Indigenous rights. Though JPMorgan adheres to the Equator Principles to manage environmental and social risk, Indigenous experts have described them as “critically weak” and not aligned with international human rights standards.[17] Effective policies that protect Indigenous rights are critical to managing material risk.

[1] https://www.un.org/development/desa/indigenouspeoples/declaration-on-the-rights-of-indigenous-peoples.html ; https://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:12100:0::NO::P12100_INSTRUMENT_ID:312314

[2] https://www.colorado.edu/program/fpw/sites/default/files/attached-files/social_cost_and_material_loss_0.pdf ; https://amazonwatch.org/news/2022/0622-the-business-case-for-indigenous-rights

[3] https://www.democracynow.org/2016/9/9/who_is_funding_the_dakota_access

[4] https://www.ran.org/wp-content/uploads/2020/12/RAN-Briefing_Line3_KXL.pdf

[5] https://www.stopline3.org/news/women-leaders-line5

[6] https://michiganadvance.com/wp-content/uploads/2022/09/20515906551-1.pdf

[7] https://www.baymills.org/_files/ugd/869f65_f8e5288d82084540a9f0e7d5d6c0921f.pdf

[8] https://narf.org/nill/documents/20210510BayMills_banish_Enbridge.pdf?_ga=2.239143744.2105983367.1624287541-1503385769.1619537483

[9] https://www.colorado.edu/program/fpw/2022/06/13/united-nations-responds-second-time-violations-anishinaabe-rights-signals-priorities

[10] https://amazonwatch.org/news/2021/1111-cop26-frontline-communities-confront-jpmorgan-chase-on-violating-indigenous-rights-and-financing-the-climate-crisis

[11] https://exitamazonoilandgas.org/ ; https://news.mongabay.com/2022/06/how-colombia-disenfranchised-indigenous-inga-communities-in-favor-of-oil/

[12] https://whc.unesco.org/en/no-go-commitment/ ; https://www.jpmorganchase.com/content/dam/jpmc/jpmorgan-chase-and-co/documents/jpmc-esg-report-2022.pdf

[13] https://www.ft.com/content/8e1acf14-e467-11e9-b8e0-026e07cbe5b4

[14] https://www.ohchr.org/en/stories/2019/09/courts-rather-spears-used-defend-indigenous-territories

[15] https://news.mongabay.com/2023/08/ecuador-referendum-halts-oil-extraction-in-yasuni-national-park/

[16] https://climatejusticealliance.org/jpmorgan/

[17] https://www.colorado.edu/program/fpw/2019/11/19/first-peoples-response-ep4-critically-weak-equator-principles-puts-global-development

Resolution Details

Company:

Citigroup

Year:

2024

Issue Area:

Climate Change, Environment, Finance

Focus Area:

Climate Financing, Environmental Justice, Indigenous Peoples/FPIC

Status:

Filed

Resolution Text

WHEREAS: The UN Declaration on the Rights of Indigenous Peoples and International Labour Organization Convention 169 concerning Indigenous and Tribal Peoples in Independent Countries are internationally-recognized standards for Indigenous Peoples’ rights. Violation of these rights presents risks for Citigroup that can adversely affect shareholder value, including reputational damage, project disruptions, and civil and criminal liability. Citigroup has a history of financing projects and companies that violate Indigenous rights, most notably as a lead financier of the Dakota Access pipeline in 2016, and providing $5 billion to Enbridge through 2021, enabling the widely opposed Enbridge Line 3 and Line 5 pipeline reroutes.

Indigenous leaders from the Great Lakes tribes have called Enbridge’s Line 5 pipeline reroute “an act of cultural genocide.” A 2022 ruling found that Line 5 was operating illegally on Bad River Band territory since 2013. Michigan’s twelve federally recognized Tribal Nations requested President Biden to decommission Line 5 in 2021, noting Enbridge’s deceptive tactics, poor environmental track record, and risk of “catastrophic damage” to Indigenous rights. Companies like Enbridge, financed by Citigroup, consistently fail to meet the international standard of free, prior, and informed consent (FPIC) with affected tribes.

Citigroup is additionally the subject of ongoing protests for its role as a top financier of oil and gas operations in the Amazon rainforest that pose “an existential threat” to Indigenous Peoples. For example, Citigroup finances Frontera Energy, which is connected to widespread violations of Indigenous Rights in Peru and Columbia. Protests and blockades from Indigenous communities opposing poor management of oil spills, lack of consultation, and health hazards have halted operations on numerous occasions, even prompting Frontera to consider pulling its investments from Peru.

Citigroup faces reputational risk if its “climate forward” commitments are discredited by its own financing activities. Citigroup’s human rights and risk management policies do not clearly define FPIC, nor include guidance on how Citigroup addresses companies with track records of violating Indigenous rights. Though Citigroup adheres to the Equator Principles to manage environmental and social risk, Indigenous experts have described them as “critically weak” and not aligned with international human rights standards. Effective policies that protect Indigenous rights are critical to managing material risk.

Resolution Details

Company:

Toronto-Dominion Bank

Year:

2023

Issue Area:

Climate Change, Finance

Focus Area:

Climate Financing

Status:

Vote

Vote Percentage:

10.40%

Resolution Text

Public companies with pollution-intensive assets such as coal, oil, and gas projects (polluting assets) are coming under increasing pressure from institutional investors with ESG concerns. Certain issuers have sold or are contemplating selling these pollution-intensive assets. When these assets are sold to private enterprises, investors are concerned about the lack of disclosure that results.

The challenge of facilitating the movement of polluting assets from public companies to private enterprises was outlined by the UN Principles for Responsible Investment (PRI) in a recent publication discussing divestment of polluting assets by public companies[1]:

While a listed company spinning off a polluting asset may eliminate emissions from its balance sheet, it is unlikely to translate to a reduction in real-world emissions. In fact, it may reduce transparency and accountability over how the asset is managed, result in higher absolute emissions from more intensive exploitation of the asset, and shift risk onto governments and taxpayers.

A March 2022 paper by the European Corporate Governance Institute (ECGI) labels this phenomenon as “brown-spinning”[2]:

[T]here has been a concerning recent phenomenon known as brown-spinning whereby public companies sell their carbon-intensive assets to players in private markets (including private equity firms and hedge funds). This helps divesting companies to reduce their own emissions but does not result in any overall emission reduction in the atmosphere. [H]aving carbon-intensive assets going dark where they are not subject to the usual strict scrutiny of public markets is worrisome from the perspective of lowering emissions.

TD’s Environmental and Social Risk Process for Non-Retail Lending Business Lines describes heightened due diligence for transactions with higher environmental and social risk and includes a list of prohibited transactions, including mining of conflict minerals and activities within sensitive cultural/ecological sites.[3] A similar approach is needed for the bank’s involvement in brown-spinning transactions to bridge the disclosure gap between public and private enterprises.

TD’s Thermal Coal Position states TD will not lend to, facilitate capital markets transactions for, or advise on M&A for new mining company clients with a certain level of involvement in thermal coal operations. [4]

ECGI describes the benefits of improved disclosure from private entities, stating: “the uneven playing field between public and private companies would be levelled, thus eliminating the classical problem of avoiding regulatory obligations tied to being public by staying private (i.e, removing incentives to remain private longer to avoid sustainability disclosures).”

RESOLVED THAT TD amend its Environmental and Social Risk Process for Non-Retail Lending Business Lines to provide that when TD provides new project-specific financial services, including advisory services, on brown-spinning transactions, TD will take reasonable steps to have parties to such transactions take steps and make disclosures consistent with TCFD, including:

ensuring acquiring board oversight of climate-related risks,
annual acquiring entity disclosure of Scope 1 and 2 GHG emissions from the acquired assets, and
regarding such acquired assets, having the acquiring entity set targets for reducing GHG emissions within a reasonable time after completing the transaction.

[1] https://www.unpri.org/download?ac=16109

[2] https://ecgi.global/sites/default/files/working_papers/documents/gozlugolringefinal.pdf

[3] https://www.td.com/document/PDF/ESG/2021-TD-Environmental-and-Social-Credit-Risk-Process.pdf

[4] https://www.td.com/document/PDF/ESG/2021-Climate-Action-Report.pdf

Tax Transparency Report

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