'Toothless' big Canadian investment firms vote down shareholder climate asks: study
Findings come amid debate over role of institutional money in shaping corporate climate policies
Several of Canada's largest asset managers voted against more climate-related shareholder resolutions than they supported in 2022, according to a new analysis by Investors for Paris Compliance (I4PC).
The advocacy group found 10 out of 19 Canadian investment firms included in a report released on Wednesday shot down the majority of climate-related proposals they voted on last year. The findings come amid a fierce debate over the role of institutional money in shaping corporate climate policies.
I4PC examined 23 North American climate-related shareholder resolutions from last year. According to its report, Beutel, Goodman & Company had the least climate-friendly voting record. The private Toronto-based investment firm with a reported $42 billion in assets under management was found to have voted against 91 per cent of resolutions included in the study.
It was a similar story for a number of other Canadian financial heavyweights. RBC Global Asset Management was found to have voted against with 89 per cent, followed by Guardian Capital (88 per cent), Manulife Investment Management (82 per cent), Alberta Investment Management Corporation (70 per cent), and Ontario Teachers' Pension Plan (69 per cent).
Meanwhile, Bâtirente, a smaller Montreal-based group pension fund, voted in favour of 100 per cent of the 23 climate-related shareholder resolutions studied from last year. Vancouver-based Genus Capital Management and Vancity followed, voting in favour on 77 per cent and 62 per cent of climate resolutions, and abstaining on 23 per cent and 38 per cent, respectively.
All of the asset managers included in the report are signatories to Climate Action 100+ (CA100+), an investor-led decarbonization effort that claims to span 700 global investors responsible for more than US$68 trillion in assets under management across 33 markets.
"When an investor joins CA100+, we expect them to prioritize climate engagement, but this analysis questions some members' commitment," Kyra Bell-Pasht, I4PC's director of research and policy, stated in a news release on Wednesday.
"Engagement is often held up as the alternative to divestment, but unless investors are willing to vote for climate proposals, engagement is likely to be toothless and ineffective."
I4PC notes the shareholder votes included in the report were "heavily influenced" by the advice of two major proxy voting services, ISS and Glass Lewis.
According to the group, climate-related resolutions also received less support at financial institutions, compared to energy companies. So-called "say-on-climate" resolutions, where shareholders cast non-binding votes on a company's climate strategy, were found to be "unpopular."
I4PC says both trends "were common in the Canadian resolutions examined and were not a feature of the American resolutions reviewed." The report adds that "this difference partly explains why several investors rarely supported Canadian resolutions, but generally supported American resolutions (e.g. TD Asset Management, Desjardins, CDPQ, Ontario Teachers' PP, and AIMCO)."
Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.
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