CalSTRS’ proxy proposals effect carbon disclosure change

Jack EhnesThe $122.4 billion California State Teachers’ Retirement System (CalSTRS) has withdrawn five of the seven climate-related shareholder resolutions filed during the 2009 proxy season after the companies pledged to improve their greenhouse gas disclosure.

The greenhouse gas proposals were withdrawn after the five companies agreed to take positive steps to address their greenhouse gas emissions disclosure. Two of the resolutions proceeded to the annual meetings of Avis Budget Group and Ultra Petroleum.

MetLife, Assurance, Noble Energy and Range Resources all pledged to improve their disclosure and respond to this year’s Carbon Disclosure Project survey. Spectra Energy is also improving its disclosure and will report to shareholders on the feasibility of adopting greenhouse gas reduction targets.

CalSTRS said the fund continues to engage Avis Budget and Ultra Petroleum on the climate-risk concerns raised in its shareholder resolutions.

“Research confirms that climate change is a fact of life in the 21st century and businesses that ignore this reality, do so at their own peril,” CalSTRS chief executive Jack Ehnes said.

“Those companies that take climate risk seriously and plan accordingly, provide the long-term value CalSTRS works
toward in ensuring the financial future of
California educators.”

Ceres, a coalition of environmental groups and institutional investors which aims to increase awareness and underscore the importance of climate risk management, reported that 30 of the record 64 climate-related investor resolutions filed in 2009 were withdrawn after the companies committed to positive measures.

Four of the CalSTRS resolutions resulted from work with the Carbon Disclosure Project, which tracks how the world’s
largest companies are measuring and reporting their greenhouse gas emissions. The other resolutions came from collaborations with other institutional investors.

A recent report by the Carbon Disclosure Project and sponsored by CalSTRS called for an energy revolution in the operation of electric utilities if greenhouse gas emissions are to be significantly reduced. The Electric Utilities Report 2009 examined how electric utilities around the globe measure and manage carbon dioxide emissions and found only 15 per cent were setting and disclosing absolute targets for reducing emissions.

The electric utilities industry accounts for 25 percent of carbon dioxide emissions worldwide; the largest share among all industries.

The report cites that unless reduced, the buildup of greenhouse gases from utilities – burning of coal and fossil fuels will accelerate global warming and catastrophically alter the planet’s environment.