AGM SEASON: BORDER TO COAST DECLARES KEY VOTES
Posted on April 14th, 2025
Managing climate risk is essential to Border to Coast as a long-term investor representing the best interests of our 11 local government pension funds.
Critical to our ability to manage this risk is the reduction of portfolio emissions and we have adopted robust climate targets and policies to support this, including a rigorous stewardship approach to the oil and gas sector.
We vote against the Chair of the Board of oil and gas companies which fail to fully meet the first five indicators of the Climate Action 100+ net zero benchmark, which includes short, medium, and long-term emission reduction targets, and decarbonisation strategy.
We also vote against the Chair if the company is scored 3 or lower by the Transition Pathway Initiative, meaning they have not yet developed a strategic understanding of climate risks and opportunities or integrated this into business strategy and capital expenditure decisions.
Another voting policy is a presumption to support shareholder proposals that are aligned with the goals of the Paris climate agreement, taking a ‘comply or explain’ approach.
We will publicly pre-declare some of our votes against management at fossil fuel company AGMs as part of our formal engagement escalation policy.
Glencore and Chevron
Glencore is a commodity trading and mining company with thermal coal mining operations in Australia, Colombia, and South Africa. Glencore has no ambition to phase out its coal production and this year dropped its target to cap thermal coal production. Border to Coast’s climate voting policy stipulates a vote against the Chair of the Board if there is a “Lack of an adequate phase out plan for thermal coal revenues”. We will therefore be voting against the re-election of the Chair at the Glencore AGM on 28 May.
Using our in-house framework, we have also assessed Glencore as failing to meet our expected human rights standards. When considering human rights issues, we believe that all companies should abide by the UN Global Compact Principles. While acknowledging the progress made regarding agreements reached with local communities around the Cerrejon mine in Columbia, we are concerned about a range of serious unacknowledged impacts on communities in Peru and the DRC. We will therefore also be voting against the re-election of the Chair of the Health, Safety, Environment and Communities (HSEC) Committee.
Chevron does not have a net zero target by 2050 or sooner, and whilst it does have a medium-term target that covers at least 95% of its Scope 1 and 2 emissions and its most relevant Scope 3 emissions, it is not aligned with limiting global warming to 1.5C. Chevron has made improvements to its decarbonisation strategy over the past year but still fails to meet benchmark indicators such as specifying the role of climate solutions (i.e., technologies and products that will enable the economy to decarbonise). We will therefore be voting against the re-election of the Chair of the Board at Chevron’s AGM on 28th May, in line with our climate voting policy.
Shell and Cheniere Energy
We voted against the re-election of the Chair of the Board at Shell and Cheniere Energy at the respective AGMs on 20 and 23 May. In line with our climate voting policy, we also voted for a shareholder proposal calling for improved disclosure on Shell’s plans for LNG production.
Shell has emission reduction targets, but they are not aligned with the goal of limiting global warming to 1.5°C. Shell also has a decarbonisation strategy but does not quantify the contribution of individual decarbonisation levers to achieving its targets and does not specify the role of climate solutions. In addition to voting against the re-election of the Chair, we will support a shareholder proposal calling for disclosures on Shell’s LNG plans, including demand forecast and consistency with its 2050 net zero target.
Cheniere Energy has emissions reduction targets but does not meet key Transition Pathway Initiative benchmarks. These include that Cheniere Energy does not report on Scope 3 emissions, does not incorporate climate change risks and opportunities in its strategy, and does not disclose the actions necessary to meet its emissions reduction targets.
Conoco Phillips and Phillips 66
We voted against the re-election of the Chair of the Board and another appropriate AGM agenda item at ConocoPhillips and Phillips 66 at their respective AGMs on the 13 and 15 May. These companies have been subject to CA100+ collaborative engagement since its inception and have not yet adopted adequate net zero targets and decarbonisation strategy.
Conoco Phillips has a net zero target by 2050 or sooner, but it does not include relevant Scope 3 emissions, its medium-term target also does not include relevant Scope 3 emissions, and the target is not aligned with limiting global warming to 1.5C. ConocoPhillips also fails to meet every CA100+ net zero benchmark indicator for decarbonisation strategy.
Phillips 66 does not have a net zero target by 2050 or sooner, and whilst it does have a medium-term target that covers at least 95% of its Scope 1 and 2 emissions and its most relevant Scope 3 emissions, it is not aligned with limiting global warming to 1.5C. Phillips 66 also fails to meet every CA100+ net zero benchmark indicator for decarbonisation strategy.
BP- update
Following BP’s announcement in early 2025 that it weakened its climate targets and transition plans and its failure to offer shareholders an AGM vote on its new strategy, we voted against management on several agenda items at this year’s AGM (17 April).
We voted against the re-election of the Chair of the Board, Helge Lund, and three other directors, including the Chair of the Sustainability Committee, and members of the Nomination and Remuneration Committees. We also voted against acceptance of the annual report and against approval of the remuneration report.
As well as voting against the Chair of the Board, we also voted against the re-election of three other board members: Melody Meyer, Chair of the Sustainability Committee, Tushar Morzaria, interim-Chair of the Remuneration Committee, and Dame Amanda Blanc, of the Nomination Committee. This reflected our concern about the governance role of these committees in BP’s strategy reset, including the removal of transition measures from remuneration policy and the terms on which a new CEO was appointed.
A large majority of shareholders supported BP’s transition plan at its 2022 AGM, which has since been weakened twice without renewing that shareholder mandate. BP has also been subject to CA100+ collaborative engagement but has not yet adopted adequate net zero targets and decarbonisation plans.
Before BP’s strategy reset, it did have a medium-term target that covered at least 95% of its Scope 1 and 2 emissions and its most relevant Scope 3 emissions, but it was not aligned with limiting global warming to 1.5C. BP also failed to meet CA100+ net zero benchmark indicators for its decarbonisation strategy. The company has moved further away from achieving these benchmarks since its strategy reset.
Colin Baines, Stewardship Manager, Border to Coast, said: “We took the step of voting against BP on a raft of measures at its AGM due to its failure to put its strategy reset to a shareholder vote.
“We call on BP to publish a comprehensive transition plan that details how it will achieve its 2050 net zero target post-2030 and put it to a vote at the 2026 AGM, to address the very real concerns of shareholders. We believe that long term value in BP is dependent upon a quality transition plan that aligns with pathways to net zero.”
This page will be updated throughout AGM season 2025 to reflect Border to Coast’s voting intentions.
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