Microsoft Annual General Meeting
Hello, I am Maren Costa, I am a Microsoft employee, and today I’m representing As You Sow on proposal number three on the proxy statement. This Proposal asks Microsoft to report on how the Company is managing the growing systemic risk created by investing retirement plan funds in companies that contribute significantly to climate change.
Recognizing the growing risks of climate change to the Company’s bottom line, Microsoft has adopted ambitious operational climate goals, including a commitment to become carbon negative by 2030, as well as a goal to reach 100 percent renewable energy by 2025. Microsoft has also backed up its climate goals with action, like creating a one billion dollar climate innovation fund. Yet, the company is investing over two billion dollars of our employee 401k savings into oil, coal-fired utilities, and agribusinesses involved in deforestation. This creates cognitive dissonance that undermines our favorable reputation as an industry leader on climate; as well as financial risk for the company, and long term risk to employees’ retirement savings.
As climate change drives the world to rapidly transition away from an extractive economy, Investments in fossil fuels will experience unpredictable, diminishing returns. A report from the Carbon Disclosure Project indicates that 215 of the largest global companies report almost one trillion dollars at risk from climate impacts, with many of those losses projected to happen within the next five years.
Climate safe investing reduces climate risk, reduces financial risk, and generates strong returns. Key findings from a recent Morgan Stanley study of nearly 11,000 mutual funds demonstrates there is no financial tradeoff in the returns of sustainable funds and traditional funds. Furthermore, what this study doesn’t measure is the future benefits of climate safe investments – to our employees, to the economy, and to our future business.
Employees’ investments in 401(k) plans generally represent a significant portion of their life savings. Microsoft has a duty to address the growing risk that climate change poses to pension fund assets, now, and in the future. Our savings are exposed to this climate-related financial risk, and currently Microsoft does not offer any climate safe investment options inside our retirement plan. While we do have access to a “brokerage window” that allows employees to go outside of the plan to find sustainable funds in the open market, this option is not easy to use for the average investor, and more importantly, it outsources investment risk to the employees.
Given the threat that climate change poses to employees’ life savings, Microsoft should demonstrate that it is safeguarding employee financial security over time by mitigating climate change-related financial and economic risk, as part of a prudently constructed lineup of easily accessed sustainable options inside of the plan.
I know that Microsoft means well by its employees. Now is the time for Microsoft to step up and actually do well for those employees. By taking climate risk into account in our 401(k) plan, Microsoft can lead its peers to help build a better future into which employees will retire.
This is not a difficult change to implement. It merely takes the board and management to agree that offering employees easy access to a climate safe retirement is in everyone’s best interest. We urge a “Yes” vote on proposal #3. Thank you for the opportunity to present on this important issue.