2020 Shareholder Impact Review:

Shareholders requested that BlackRock’s Board prepare a report based on a review of the Business Round Table New Statement of the Purpose of a Corporation and provide an implementation plan. We earned a 3.9% vote, representing $2.5 billion in assets. After our presentation, BlackRock’s CEO Larry Fink made a statement that seemed to endorse our proposal. He indicated that he believes that BlackRock already operates in accordance with the new purpose principles by simply signing on. We continue to ask how this intent becomes action.

This Chevron petrochemical resolution asked that the company publish a report assessing the public health risks of expanding petrochemical operations in areas prone to climate change-induced storms, flooding, and sea level rise. The proposal garnered a 46% supporting vote, representing $50 billion in assets. This significant investor vote demonstrates increasing concern for companies expanding petrochemical operations in areas that are facing climate-related physical impacts.

Co-filed with Trillium Asset Management, this resolution won a 19.5% vote worth $255.6 billion in assets (representing 65% of independent shares since CEO Zuckerberg has a 10:1 voting preference). Shareholders requested Facebook adopt a policy requiring that the Chair of the Board be an independent member of the Board. Compliance with this policy is waived if no independent director is available and willing to serve as Chair.

This resolution received an impressive majority vote of 61.1%, representing $9.8 billion in assets. This was a 20% increase over last year’s similar resolution, which also requested that the Board issue a report to shareholders assessing the diversity of its company’s workforce using Sustainable Accounting Standards Board (SASB) materiality guidelines.

Similar to the Fastenal resolution, the Genuine Parts resolution also asked the company to use SASB guidelines in their sustainability report describing the company’s Human Capital Management policies, performance, and improvement provisions on workforce diversity, inclusion, and labor practices requirements. This first-year proposal garnered an overwhelming 79.1% majority vote, representing $6.9 billion in assets.

This resolution urged Home Depot to adopt a policy requiring that future grants and awards to senior executives retain a significant percentage of shares acquired through equity compensation programs for a significant period of time following the termination of their employment. We collected a record number 97 authorizing shareholders for filing this resolution. A 26.4% vote in support, representing $47.3 billion in share value, was earned for this first-year resolution.

As the world’s largest global financier of fossil fuels, this proposal asked that the bank issue a report outlining if and how it will align its financing activities with the Paris Agreement’s goal of maintaining global temperature rise below 1.5 degrees Celsius. The vote came in at 49.6% in favor, representing $95.5 billion in assets.

For the third consecutive year, we filed a resolution asking Kroger, the largest supermarket retailer in the U.S., to assess the reputational, financial, and operational risks associated with continuing to use non-recyclable packaging for its private brand goods. The vote of 38.4% held steady from last year’s 38.9% vote.

Earning a 66% vote worth $15.4 billion in assets, As You Sow’s resolution with O’Reilly Automotive is the third majority vote achieved in our set of resolutions asking companies to report their adherence to the metrics and guidelines set forth in the SASB standards’ provisions on workforce diversity and inclusion and labor practices requirements.

Shareholders asked Phillips 66 to publish a report on the public health risks of expanding petrochemical operations and investments in areas increasingly prone to climate change-induced storms, flooding, and sea level rise. A vote of 54.7%, worth $11.8 billion in assets, gave As You Sow our fourth majority vote for the 2020 proxy season and shows how concerned investors are about this issue.

This resolution requested that they publish a report annually that assesses their diversity and inclusion efforts. The report is to include how the Board judges the effectiveness of their recruitment and retention of diverse employees. Procter & Gamble presents their belief in inclusivity very publicly as a core value of their corporate culture and they have a workforce of over 97,000 people. We asked them to quantify those beliefs. This proposal earned a 37% vote worth $92.6 billion in assets.

The resolution with Sanderson Farms requested a report tracking water stress trends and impacts that are expected to be exacerbated by climate change. We requested the company use the quantitative metrics identified by SASB to provide material information on water resource risks for the Meat, Poultry, and Dairy sector. We earned an 11.4% vote for this proposal. Immediately following the AGM, Sanderson Farms issued a press release that said “in recognition of evolving investor expectations in regard to sustainability reporting, the Company is committing to integrate the reporting standards of the Sustainability Accounting Standards Board (SASB) into its environmental, social, and governance (ESG) disclosures by the end of fiscal 2020 . . . We thank our investors for their feedback and support, and we look forward to providing SASB-aligned disclosures addressing ESG issues that are important to them.”

Walmart distributes an estimated 18 to 20 billion single-use plastic carry out shopping bags per year, which contributes to the increasing plastic pollution in our oceans. This resolution asked the company to look at and evaluate the business risks related to continuing the use of single-use plastic bags and possibly targets, and a timeline for phasing them out. We earned 17% shareholder support for this proposal, representing $49.7 billion in investor support. We are planning to reintroduce the resolution next year and continue our dialogue with the company.

The company agreed to begin measuring data from ESG initiatives in accordance with SASB accounting standards regarding Human Capital Management.

Baker Hughes, an oil fields services company, agreed that it will update internal company water conservation guidance and resources to include best practices; identify operations in water scarce areas for internal evaluation; benchmark and report on water reporting key performance indicators; re-evaluate and report externally on water risks, including flooding, risks related to climate change, and energy/water nexus, including information on water scarce areas; and report water metrics in its upcoming sustainability report.

Bank of America agreed to enhance its climate risk reporting and provide As You Sow the opportunity to give input on its upcoming Task Force on Climate-related Financial Disclosures report as well as to assess methodologies to begin measuring the greenhouse gas (GHG) emissions associated with its financing activities toward aligning its financing with the Paris 1.5 degree goal. As a result, Bank of America recently made a major announcement that it is joining the global PCAF measuring and accounting system under which the company will measure and disclose the organization’s financed emissions, a huge first step signaling that monies for high emissions projects and companies will decline.

BP and shareholders have agreed to work together to prepare a shareholder resolution for BP’s Annual General Meeting in 2021. The resolution requires the company to set a net-zero ambition – including for Scope 1, 2, and 3 emissions – and increase the proportion of its investment that goes into non-oil and gas businesses in support of the goals of the Paris Climate Agreement.

Campbell’s has agreed to implement three new sustainable sourcing programs for three key supply chains (tomatoes, wheat, potatoes), including goals to reduce pesticide use. It will also disclose metrics by which progress can be measured year over year. We will continue to engage with the company and push for goals and metrics that apply to the company’s other crop supply chains.

The Board agreed to implement post-termination holding requirements for the CEO and executive officers, who will now be required to hold 50% of their ownership for one year after termination (with some exceptions). The company also strengthened its ownership requirements, including increasing the ownership requirement for the CEO.

As You Sow agreed to withdraw its shareholder resolution given two important commitments by Coca-Cola The company committed to review the benefits provided by its U.S. company-sponsored healthcare plans to determine if any Coca-Cola employee lacks equal access to medical procedures, services, and/or benefits due to geographic location or state laws. It will also review its political advocacy process for political spending and engagement strategies related to public policy to ensure its brands and company reputation are being protected in the process and are not at odds with the company’s values, which include “empower[ing] people’s access to equal opportunities/[and] build[ing] inclusion.”

The company has agreed to disclose data on antibiotics used in its new chicken processing operation in Nebraska. While Costco remains behind other chicken producers in ending use of medically important antibiotics, collecting this data is an important first step for the company. The public disclosure is important in helping shareholders to understand progress the company is making. We will continue to engage with Costco on this and an end to use of medically important antibiotics by Costco’s private label beef, pork, and poultry suppliers.

DiamondBack Energy committed to the following: to respond to the CDP Water Questionnaires; add enhanced disclosures in its 2020 Corporate Responsibility Report on water sourcing assessments/testing, total water use and types of water used in operations, water constrained operations or other places where potential water shortages might impact the company; adopt water recycling initiatives and other related efforts to reduce use of water; and disclose content on how climate change impacts water management considerations.

Duke reached an agreement with the North Carolina Department of Environmental Quality and environmental groups to excavate coal ash ponds in the state (excavating is considered a best practice), satisfying our proposal. Duke has further committed to improve transparency on its plans for coal ash basins in other states where it operates and to continue to work with us on this issue.

Entergy committed to centralize its current water related risk management information and to publish information on several issues: its water management process, including governance mechanisms; water risk assessment tools; water scarcity planning actions and strategy; water supply issues; competition for water resources; and flooding risks and any related risk mitigation measures, particularly as they may relate to climate change.

The #RebootFacebook resolution was filed to encourage the social media giant to bring decency, democracy, and disclosure back to the brand and all of its customers and shareowners. The proposal was withdrawn with the promise of further dialogue with As You Sow.

General Electric committed to set a new GHG target for its Scope 1 and 2 emissions, to analyze how it can reduce product emissions (Scope 3) and align its business with Paris goals, and to continue working with us toward this important goal.

Gilead Sciences agreed to substantively increase its disclosures related to its workplace equity. This will include the public disclosure of demographic data of employees (total and hired) by gender, race/ethnicity, disability, military, and LGBTQ+, and EEO-1 summary data. It will also be providing framing language and context setting narratives around its diversity and inclusion program.

Goldman Sachs agreed over the next year to evaluate methodologies for measuring its financed emissions toward aligning with the Paris Agreement.

Halliburton committed to publicly disclose its water consumption data, how it is engaging with its value chains to reduce water risks, and water risk scenarios conducted by the company, including extreme weather impacts from climate change.

We withdrew this resolution after productive dialogue with the company. The company has committed to assess and potentially reduce pesticide risk from its supply chain, including assessing grower use of pesticides, the feasibility and effectiveness of alternatives to pesticide use, the level of adoption of integrated pest management practices, and the potential and ability to reduce pesticide risk.

JP Morgan Chase has agreed to publicly disclose the gender and ethnicity of the company’s workforce for 2018 and 2019. Additionally, it will disclose promotion level data related to employees moving into Managing and Executive Director roles in 2021.

Kellogg has agreed to phase out pre-harvest glyphosate use in wheat and oats and has also agreed to develop metrics for reporting on pesticide use in its supply chain. The company has shown good faith efforts to work with us on its disclosures and pesticide reduction goals.

This resolution was co-filed with Mercy Investment Services, Inc. Marathon committed to set a GHG intensity target to reduce its Scope 1 and 2 emissions. Marathon also committed to reassess the target as progress is made and to continue to dialogue around increased climate ambition and to address the company’s significant Scope 3 emissions.

Mastercard agreed to increase its reporting around its workplace equity practices, releasing key information on its promotion and recruitment of diverse employees as well as diversity data related to workforce composition data by gender, race, and ethnicity.

MetLife agreed to benchmark comparative data on gender, ethnic, and racial diversity relative to other companies. It will publish the percent representation in a report covering 2017-2019 and will report promotion rates. It has also committed to create a clear and easily accessible repository for its reporting on this topic area.

Morgan Stanley agreed over the next year to take the critical step of committing to disclose its financed emissions and to continue exploring and testing relevant portfolios using the Paris Agreement Capital Transition Assessment tool. Accordingly, Morgan Stanley recently demonstrated leadership in announcing a commitment to measure and disclose its financed emissions under the PCAF global measuring and accounting standard.

The company agreed to publish its first Diversity Report in 2020. The report will provide a comprehensive overview of its diversity and inclusion efforts and will include information on key programs, initiatives, and metrics. Included will be representation rates and distribution across the firm; recruitment activity, rates, and outcomes for key under-represented groups; and data and trends for retaining and promoting diverse talent.

We were able to withdraw our pellet spill reporting proposal at Occidental after the company agreed to initiate reporting on the actions it is taking to reduce plastic pellet spills.

The company agreed to issue a report on gaps in recycling infrastructure and the investments in technology that are being made to improve recycling yields.

Southern committed to enhance its disclosures regarding its natural gas investments and the steps it is taking to mitigate the climate impacts of those investments to align with the company’s low-to-no carbon goal.

Spire committed to working with us to improve disclosure on its methane management and to implement best practices such as setting a methane target and engaging its supply chain.

Following months of constructive dialogue with As You Sow, Starbucks has agreed to shift from single-use packaging to reusable packaging, conduct unprecedented research to promote customer behavior change, develop new global reusable container goals, and cut global packaging waste 50% by 2030.

Ulta Beauty committed to disclosing the median hourly wage of its in-store full-time employees, the voluntary and involuntary turnover ratios, and the percentage by gender and ethnic group for global operations.

Waste Management agreed to issue a report identifying gaps in recycling infrastructure as a means of increasing plastics recycling. Waste Management released its “WM Recycling and Policy Proposal” report on 9/2, identifying gaps in recycling infrastructure, discussing how many of its processing facilities have been upgraded, and which facilities can boost material yield.

Wells Fargo agreed to assess and report progress in measuring the GHG emissions associated with its financing activities with the intent to inform efforts to set a Science Based Target and to provide As You Sow the opportunity to give input on its upcoming climate report.

The company has agreed to disclose its goals for creating full visibility on the sources of beef in its supply chain as a first step in addressing antibiotics use. The company has also agreed to set a goal for increasing the percentage of beef sourced from cows free of medically important antibiotics. We will continue to work with the company on its plan to reduce antibiotics use in its supply chain.

Westlake Chemical, one of the largest producers of low-density polyethylene, has agreed to start reporting on spills of pre-production plastic pellets, or nurdles, manufactured in its production plants. Plastic pellets are emerging as a significant source of ocean plastic pollution.

Yum! Brands has agreed to remove Styrofoam and EPS packaging by the end of 2022. It is expanding its sustainable packaging to its Taco Bell brand, is committing to continue making progress with its KFC brand, and has re-committed to finding alternatives to plastic straws.