ATLANTA, GA, June 4, 2003 — The vote of 23 percent (with 75 percent of the ballots counted) for a climate-related resolution at Southern Co. follows similar strong showings of 24 percent at TXU Corporation on May 16, 2003 and 26.9 percent at American Electric Power (AEP) on April 23, 2003.
All three companies were targeted by investors as a result of concerns over company disclosure of and plans to mitigate the risks of the four pollutants caused by electric power generation.
The resolutions expressed particular concern about the risks associated with carbon dioxide, the major greenhouse gas causing global climate change, a pollutant that is not currently regulated. The U.S. electric power industry contributes 10 percent of the world’s carbon dioxide emissions. Southern Company is the nation’s second largest electric power company emitter of carbon dioxide, and one of the largest emitters in the world.
The State of Connecticut pension fund and members of the Interfaith Center for Corporate Responsibility (ICCR) were among the major filers of the resolutions at all three utilities. The Southern resolution was sponsored by the Sisters of Charity of St. Elizabeth of Convent Station, N.J. and the United Church Foundation.
Only 3 percent would have been required by the U.S. Securities and Exchange Commission (SEC) for these first-time proxy resolutions to be reintroduced at the companies in 2004. The 23 percent vote in favor of the Southern climate-related resolution exceeds the average of 18 percent achieved by global warming resolutions during the 2002 shareholder season, according to data from the Investor Responsibility Research Center.
Interfaith Center for Corporate Responsibility Treasurer and Sisters of Charity of St. Elizabeth of New Jersey Sister Barbara Aires said: “We can now say for certain that the pressure is on America’s utilities, which are among the greatest contributors in the world to global warming. The vote at Southern joins those at TXU and AEP in sending a crystal-clear message to the management of America’s major utilities: More and more institutional shareholders are concerned about the hidden risks of global warming and they want action now. Shareholders are insisting that utilities recognize, report on and then address climate-related risks to shareholder wealth.”
United Church Foundation Director of Corporate Social Responsibility Amy Muska O’Brien said: “It is heartening to see so many faith-based and ‘traditional’ shareholders find common ground in climate-related concerns. These are not just issues for those of us with religious and environmental concerns. Today, we are joined by institutional investors who cast millions of votes in favor of urging America’s utilities to disclose the full risks of climate change. Utilities have a lot to answer for on global warming and a long way to go before they can be said to be doing an adequate job of measuring and mitigating climate risks to shareholder wealth.”
Mindy Lubber, executive director of CERES, a coalition of investors and environmental groups that aided the filers, said: “This company is not only contributing to climate change, threatening investments across the board, but they’re also simply demonstrating poor risk management. If you emit a lot of carbon, and it’s looking like carbon is going to be capped, and you’re not exploring alternatives, you’re going to lose money for your shareholders.”
The resolution voted on at Southern and the two other utilities states in part: “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 the companies 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).”
ABOUT THE GROUPS
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 http://www.iccr.org.
The United Church Foundation (UCF), an Associated Ministry of the United Church of Christ, serves as the asset manager for the denomination’s institutions, other than its pension fund. The UCF serves over one thousand United Church of Christ congregations and other entities, managing nearly $500 million of their endowment funds and other permanent assets.
CERES (http://www.ceres.org) is the leading U.S. coalition of environmental, investor, and advocacy groups working together for a sustainable future representing over $300 billion in invested capital.