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Major Asset Managers Exit Climate Action 100+, Sparking Influence Concerns

The departure of major asset managers has sparked debate about Climate Action 100+'s effectiveness. With Exxon's lawsuit looming, the future of shareholder activism in driving climate transition is uncertain.

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In the right side there are people in the market, it's a sunny sky in the market.
In the right side there are people in the market, it's a sunny sky in the market.

Major Asset Managers Exit Climate Action 100+, Sparking Influence Concerns

Climate Action 100+, a global investor-led initiative, has seen significant changes with major asset managers exiting the coalition. The departure of State Street, JP Morgan, and BlackRock's international wing has removed over $14 trillion in assets. This follows Exxon Mobil's lawsuit against shareholders who filed climate resolutions.

Keith Guthrie, sustainability head at Cardano and Now: Pensions, stressed the importance of shared values when choosing a manager for stewardship. The exits, however, have raised concerns about the alliance's influence. Gustave Loriot-Boserup of Compass Insights described the departures as unsurprising, given the historical voting patterns of the asset managers against CA100+ proposals.

Sam Mahtani, founder of Alpha ESG Consulting, played down the impact, noting that CA100+ still has a substantial signatory base. Yet, research by ShareAction revealed that some members repeatedly voted against alliance-flagged resolutions. Cynthia Hanawalt, director at the Sabin Center for Climate Change Law, warned that Exxon's lawsuit threatens shareholder rights. This year, no activist resolution will be filed at Exxon's AGM, sparking questions about asset owners' influence over climate transition planning at oil and gas firms.

The exits of major asset managers from Climate Action 100+ have sparked debate about the alliance's effectiveness. While some argue the impact is minimal, others worry about the influence of asset owners in driving climate transition at oil and gas companies. The future of shareholder activism in the face of legal challenges like Exxon's lawsuit remains uncertain.

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