Big Banks Can Block Shareholder Climate Proposals, SEC Rules

The Securities and Exchange Commission recently allowed two large banks to block a shareholder proposal addressing the climate impact of the banks’ investment portfolios. 

The proposal requested that Goldman Sachs and Wells Fargo reduce the carbon footprint of their loan and investment portfolios to align with the Paris Climate Agreement’s goal of holding global warming below 2 degrees Celsius. The SEC’s decision means that it will be excluded from proxy materials that the companies’ shareholders will consider at the annual meetings. 

“We’re very disappointed that [the SEC] won’t even allow this on the ballot,” said Danielle Fugere, president of As You Sow, a shareholder advocacy group involved with this resolution and other climate-related proposals. 

She said the proposal, if passed by the company’s shareholders, would not have mandated action but would have raised the issue with the banks’ boards and management.