Chevron is pushing back against an activist-led movement to introduce a slew of climate-related resolutions Wednesday at the energy company’s annual shareholder meeting.
Activist shareholders are preparing to ask Chevron to detail how the company can cut emissions of methane, a greenhouse gas from natural gas production that scientists believe contributes to global warming. Shareholders are also seeking to implement a resolution asking the company to issue a report on how it adapts a business model for a world without fossil fuels.
Chevron claims it is already taking relevant steps to address methane emissions, negating the need for the first resolution. And company spokesman Sean Comey said the company disagrees with the premise that Chevron must “curtail production of fossil fuel resources and/or to diversify their portfolios proportionately,” in a world of expanding energy resources.
The methane resolution is likely to pass the 50 percent mark necessary for implementation because similar votes have passed at other energy companies. The second, more aggressive, resolution will probably not go anywhere, Danielle Fugere, president of nonprofit As You Sow, told Axios. It’ll probably fail because it asks Chevron to radically change its business model.
The Trump administration has taken significant steps to tackle similar activist-led efforts against public pensions. The Labor Department issued a warning in April to managers of retirement funds to avoid using politically motivated investment strategies to tackle environmental issues. Several retirement funds have used exotic techniques during the past several years to submit proposals designed to push political campaigns.
Using resources to promote so-called environmental, social and governance (ESG) proposals is a violation of a pension fund’s fiduciary duty unless the proposal can financially improve the company’s value. If the shareholder cannot demonstrably prove the proposal’s financial benefit, then pension recipients can sue the retirement fund for mishandling their money. (RELATED: Trump Strikes A Blow For Retirees Worried About Enviros Wallowing Out Pensions)
The new guidance rule comes as reports consistently warn about the real-world consequences of forcing pensions to take up green activist agendas. A report published in July 2017 suggested public pension funds could be on the hook for trillions of dollars if they move to divestment from troves of fossil fuel assets. (RELATED: Report Warns Of Shadowy Industry Being Used To Push Climate Change Orthodoxy)
Selling off oil and gas investments would cost 11 of the largest and wealthiest public pension funds in the world nearly $5 trillion over 50 years due, in part, to a lack of diversity, according to a 2017 report sanctioned by energy lobby group Independent Petroleum Association of America (IPAA).
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