Climate-Change Groups Strong-Arm Eagle, Mdu/Knife River, Vulcan Into Shareholder Disclosures

Environmental activists have taken a new approach to compel public companies to improve their sustainable practices, environmental protection and means of disclosing how they are assessing and mitigating climate change risk

Sources: Investor Network on Climate Risk, Boston; CP staff

Environmental activists have taken a new approach to compel public companies to improve their sustainable practices, environmental protection and means of disclosing how they are assessing and mitigating climate change risk. During what is being referred to as the height of the 2010 proxy season, groups have flooded 82 U.S. and Canadian companies with 95 global warming shareholder resolution filings, in the hopes of having the corporations enter into negotiations that will make them more accountable and transparent.

Although some green organizations have been engaging in such practices for the better part of two decades, recent pressure by the U.S. Environmental Protection Agency and the Securities and Exchange Commission has added both an urgency and visibility to the matter. Among those singled out during this wave of filings are Eagle Materials (to reduce greenhouse gas emissions); MDU Resources (to adopt quantitative goals for reducing greenhouse gas emissions throughout the Knife River Corp. construction materials subsidiaries, and report on efforts to lower the impact from coal ash in MDU utility operations); and, Vulcan Materials (to begin a program of sustainability reporting). Valmont Industries, which produces precast/prestressed concrete and steel utility poles and towers, has also been tagged (sustainability reporting, specifically targeting water-use strategies and greenhouse gas emissions).

According to a representative from Calvert Asset Management Co., the Valmont filing was withdrawn after the company committed to enhancing its present environmental, social and governance disclosure. Taking another approach, MDU Resources opted to submit an opposition statement in its proxy to a filing from corporate watchdog group AsYouSow.org, which has been filing shareholder resolutions for 15 years. Our goal is not to go to a shareholder vote, although shareholders should have their voices heard on how a company is run, says Amy Galland, from the activist organization. This is the first time a filing has gone to a coal ash-handling company, and with the EPA possibly designating coal as a hazardous material, we would rather have MDU and other coal-fired utilities responsibly mitigate and be more transparent about the risks regarding coal ash. MDU is at risk, since 5 percent of its coal ash is used in concrete production.

Filings aimed at Eagle and Vulcan, as well as one of two MDU filings, originated from the offices of the Comptroller of New York City, which has had a policy on its books since 2005 to police corporate responsibility, including proposals seeking improvement in the workplace, protection of labor and human rights, and the protection of the environment, including disclosure of how companies assess and mitigate climate change risk.