2024 VOTING GUIDE PROXY VOTING FOR A 1.5°C WORLD

 

2023 was the hottest year on record by a large margin, and January 2024 was the hottest January on record. Yet, 2023 will be one of the coolest years over the coming decades unless the global energy system immediately begins a transition to net zero emissions in line with the Paris Agreement goal of limiting warming to 1.5°C.

The path to 1.5°C has narrowed but remains open. In September 2023, the International Energy Agency (IEA) published an updated version of the Net Zero Emissions by 2050 Scenario (NZE) that accounts for the latest shifts in technologies, markets, and policies since the NZE’s initial 2021 publication. The 2023 NZE scenario lays out a cost-effective and economically productive scenario for the energy sector to achieve net zero carbon emissions by 2050, thereby leaving open the possibility of limiting warming to 1.5°C. Under this scenario, as clean energy expands and fossil fuel demand declines, there is no need for investment in new coal, oil, or natural gas. Furthermore, emissions in advanced economies must collectively decline by 80% by 2035 from 2022 levels.

When companies fail to transform operations and business models in line with a 1.5°C pathway, responsible shareholders must use their most powerful tool—proxy voting on corporate board elections—to hold directors accountable. To help investors exercise this power, Majority Action evaluates the climate disclosures of industry laggards in the energy, utilities, and financial services sectors against widely accepted benchmarks and issues company-specific vote guidance against directors and board leadership responsible for climate oversight at corporations that have failed in the critical areas of target setting, capital expenditure alignment, and policy engagement alignment.

2024 VOTE RECOMMENDATIONS

Majority Action will be updating our recommendations with the names of specific directors as proxy statements are filed. Access Majority Action’s vote recommendations in spreadsheet form here.

Vote against all board members under the following circumstances:

  • The oil & gas company does NOT have a medium-term GHG reduction target that covers at least 95% of its scope 1 and 2 emissions and relevant scope 3 emissions. ¹

Vote against the Chair and/or Lead Independent Director, and relevant committee chair(s) under the following circumstances:

  • The oil & gas company’s potential future investments on new upstream oil & gas projects exceeds the IEA’s Announced Pledges Scenario (APS, >1.7°C) allowance. ² 

  • The electric utility’s net zero GHG emissions by 2050 ambition³ and/or medium-term GHG target omits relevant scope 3 emissions,⁴ or the electric utility’s planned fuel capacity exceeds the IEA’s Announced Pledges Scenario (APS, >1.7°C) allowance.⁵

Vote against the relevant committee chair(s) under the following circumstances:

  • The electric utility’s Influence Map Real-world climate policy engagement score is below a (C-), indicating significant misalignment to the Paris Agreement.⁶

  • The bank has failed to set sector-specific oil & gas targets for its financed emissions in terms of absolute emissions,⁷ or the bank has no exclusion policies for fossil fuel projects.⁸

  • The bank has failed to set sector-specific…for fossil fuel projects.”

  • The insurer has not disclosed its insurance-associated emissions.

 Climate Action 100+ Benchmark Assessment, Indicator 3

  1.  Climate Action 100+ Oil and Gas Assessment - Carbon Tracker Initiative, Indicator 2

  2.  Climate Action 100+ Benchmark Assessment, Indicator 1

  3.  Climate Action 100+ Benchmark Assessment, Indicator 3

  4.  Climate Action 100+ Electric Utilities Assessment - Rocky Mountain Institute, Indicator 1.2

  5.  Climate Action 100+ Climate Policy Engagement Assessment - InfluenceMap, Indicator 1

  6.  Transition Pathway Initiative Carbon Performance Alignment Matrix; Reclaim Finance Policy Tracker

  7.  Insure our Future 2023 Scorecard; Reclaim Finance Policy Tracker

2024 EXEMPT SOLICITATIONS

Majority Action will review updates of the data sources on which it relied, new information provided by shareholders and other stakeholders, and new announcements at these companies prior to their annual meetings in 2024. These recommendations are subject to change. Check proxyvoting.majorityaction.us for updates. 

Please contact us at investors@majorityact.org with questions, comments, or if you would like to set up a meeting with our team.