COLUMBUS, Ohio, April 23, 2003 — A global warming proxy resolution garnering 26.7 percent of shareholder support Wednesday at American Electric Power (AEP) is a “big win” for shareholder advocate members of the Interfaith Center on Corporate Responsibility (ICCR) pressuring major U.S. utilities to take action on climate-change issues.
Only three percent is required by the U.S. Securities and Exchange Commission (SEC) for this proxy resolution to be reintroduced at AEP in 2004. The 26.7 percent vote in favor of the resolution compares favorably to the average of 18 percent achieved by global warming resolutions during the 2002 shareholder season, according to data from the Investor Responsibility Research Center.
The AEP resolution was sponsored by the State of Connecticut Plans and Trust Fund and Christian Brothers Investment Services, both of which are members of the Interfaith Center on Corporate Responsibility.
ICCR played a key role in facilitating the filing of the global warming resolution at AEP and the other four major U.S. utilities known as the “filthy five” in recognition of their contributing the largest amounts of carbon dioxide (CO2) pollution in their industry category.
ICCR Program Director for Energy and the Environment Leslie Lowe said: “We were hoping for a good showing, but the final tally of shareholder support ended up exceeding our most ambitious projections. The AEP vote today sends a strong message to the U.S. utilities industry that you can’t just ignore global warming or pay it token lip service. Religious shareholders and other concerned investors are understandably worried that the value of the stock they possess is being held ransom to the refusal of companies like AEP to come to terms fully with the reality of climate change. For religious investors, it’s simple: We want to protect both the sanctity of God’s creation and the financial well-being of shareholders.”
Christian Brothers Investment Services Corporate Advocacy Coordinator Julie Tanner said: “This is a material financial issue to the entire electric utility industry, and the kind of disclosure we are seeking should become standard practice on an industry-wide basis. Today, a significant share of AEP shareholders sent a message to management that they are not content to sit by while the company in which they hold stock fails to address this very serious hidden risk to the value of company shares. Christian Brothers Investment Services is pleased to have worked with others at ICCR to play a leadership role in forcing AEP to reckon with global warming.”
The AEP resolution states: “We believe that taking early action on reducing emissions and preparing for standards could better position companies over their peers, including being first to market with new high-efficiency and low-emission technologies. Changing consumer preferences, particularly those relating to clean energy, should also be considered. Inaction and opposition to emissions control efforts could expose companies to reputation and brand damage, and regulatory and litigation risk.”
The global-warming resolution asks AEP to report to its shareholders on “(a) the economic risks associated with the company’s past, present, and future emissions of carbon dioxide, sulfur dioxide, nitrogen oxide and mercury emissions, and the public stance of the company regarding efforts to reduce these emissions and (b) the economic benefits of committing to a substantial reduction of those emissions related to its current business activities (i.e. potential improvement in competitiveness and profitability).”
During a January 16, 2003 news event, ICCR joined other resolution co-filers in branding AEP and four other U.S. electric utilities as the “filthy five” largest CO2-polluting power companies in America.
Comparable solutions also were filed through ICCR at the balance of the “filthy five”: Southern Company (NYSE: SO), Xcel Energy Inc. (NYSE: XEL), TXU Corporation (NYSE: TXU), and Cinergy Corporation (NYSE: CIN).
The Interfaith Center on Corporate Responsibility is an association of 275 faith-based institutional investors, including national denominations, religious communities, pension funds, endowments, hospital corporations, economic development funds and publishing companies. ICCR and its members press companies to be socially and environmentally responsible. Each year ICCR-member religious institutional investors sponsor over 100 shareholder resolutions on major social and environmental issues. The combined portfolio value of ICCR’s member organizations is estimated to be $110 billion. Visit ICCR on the web at www.iccr.org.
ABOUT CHRISTIAN BROTHERS
Christian Brothers Investment Services (CBIS) manages approximately $3 billion for Catholic organizations seeking to combine faith and finance through the responsible stewardship of Catholic assets. CBIS’ combination of premier institutional asset managers, diversified product offerings, and careful risk-control strategies constitutes a unique investment approach for Catholic institutions and their fiduciaries. CBIS strives to integrate faith-based values into the investment process through a disciplined approach to socially responsible investing that includes principled purchasing (stock screens), active ownership strategies (proxy voting, dialogues with corporate management, shareholder resolutions) and community investment. The firm contributes a portion of all profits to support the Church’s educational and social ministry.
For more on CBIS, visit the firm’s web site (www.cbisonline.com).