Last week JPMorgan Chase held its annual general meeting of shareholders. The strong votes in support of environmental and social resolutions provide a telling example of why the SEC has proposed a rule to weaken shareholder power and thereby weaken corporate accountability. Green America’s 2020 list of sample shareholder resolutions to vote, including votes at Chase, calls attention to shareholder resolutions that push Corporate America toward greater responsibility to people and the planet.
Let’s look at several of the votes that just took place at Chase – and the momentum they exert for greater corporate change. As you’ll read, it’s no wonder SEC commissioners who side with corporate management want to reign-in shareholders who recognize that shareholder value is indeed linked to social justice and environmental sustainability.
During the past year, and especially in the run up to the shareholder meeting on May 19, 2020, pressure on JPMorgan Chase has been mounting from investors and climate activists seeking to halt the bank’s massive financing of fossil fuels. Chase invests more in fossil fuels than any other bank in the world.
Chase’s bankrolling of fossil fuels is not surprising given the leadership role of Lee Raymond on its board of directors. Raymond is a former ExxonMobil CEO, life-long climate change denier, and has served on the Chase board for over three decades. Three New York City pension funds, the New York State Common Retirement Fund, and the Pennsylvania State Treasurer -- all major institutional investors -- stated they would vote against Raymond’s continuation on the Chase board. Green America and our allies in the Stop the Money Pipeline coalition educated individual and institutional investors nationally on the importance of getting Raymond off the board. This year, while all the directors received majority support -- shareholder opposition to Raymond increased by 120% over last year. The vote on Lee Raymond tells us: Shareholder dissatisfaction and a desire for new board leadership is increasingly clear.
Continuing to address the bank’s climate impacts, almost half of Chase’s shareholders—48.65% -- voted last week in favor of a resolution requesting a report on whether, and if so how, the bank will reduce the greenhouse gas emissions associated with its lending in order to meet the goal of the Paris Agreement to keep global temperature increases below 1.5 degrees C. Chase urged shareholders to vote against this climate resolution and the vote tells us: Shareholders want a better understanding of the climate impacts of the bank’s financing and Chase management is barely holding on to shareholder support.
In addition, 14.86% of shareholders supported another resolution calling for a report on how the bank plans to address increasing risk to its reputation due to its support for Canadian oil sands production and production and exploration of Arctic oil and gas. Chase urged shareholders to vote against this resolution and the vote tells us: More than enough shareholders supported this resolution to allow it to be re-submitted next year for further consideration.
It is always important to ask what shareholder resolution results actually mean. Corporate management and the media often portray shareholder votes in simple “up or down” terms. However, since nearly all shareholder resolutions are advisory in nature -- and since double-digit support for social and environmental proposals carries significant weight – a “win” is not limited to achieving majority support.
A “win” is about getting issues of concern recognized by both management and investors and adding shareholder clout to broader, societal movements seeking needed, positive change.
This is ultimately why we need to oppose any move by the SEC to undercut the shareholder resolution process that does a good job of identifying risks that companies otherwise often choose to ignore.
You can bet JPMorgan Chase sees the shareholder writing on the wall – change is coming. And that will be a real win for people and the planet.