Boeing shareholders – with the support of the company’s board – have voted overwhelmingly in favor of a proposal seeking information about the aircraft manufacturer’s move toward net-zero emissions.
According to an SEC filing, 91.36 percent of the votes cast at the company’s recent AGM backed a proposal filed by As You Sow asking that Boeing’s board release a report ‘evaluating and disclosing if and how the company has met the criteria of the net-zero indicator, including Scope 3 use of product emissions, or whether it intends to revise its policies to be fully responsive to such [an] indicator.’
As You Sow writes that a key sign of a company’s alignment with the Paris climate accord is indicator 1 of the Climate Action 100+ initiative’s net-zero benchmark, called the ‘net-zero [greenhouse gas (GHG)] emissions by 2050 (or sooner) ambition’: the net-zero indicator.
This seeks disclosure on whether a company has set a goal of achieving net-zero GHG emissions by 2050 and whether that goal explicitly includes Scope 1, Scope 2 and relevant Scope 3 emissions. The benchmark also urges companies to improve climate governance and provide specific climate-related financial disclosures.
‘A failure to comply with benchmark goals and disclosures is likely to pose a material risk to Boeing and its shareholders, in particular the failure to clearly disclose whether the company has adopted net-zero [GHG] reduction goals across its full range of emissions,’ As You Sow writes in its supporting statement. ‘Failure to address such a critical climate issue may have a negative effect on Boeing’s cost of capital and shareholders’ financial returns.’
It continues: ‘While Boeing has targets to reduce Scope 1 and [Scope] 2 emissions by 55 percent by 2030 on core sites, and has committed to achieve carbon-neutrality on some aspects of its business (scopes 1 and 2 and business travel) through the purchase of carbon offsets, it has not reported an ambition to reduce its Scope 3 product emissions – constituting 99 percent of its total emissions – which is a critical gauge of whether and how the company is reducing climate risk and capitalizing on low-carbon opportunities.’
According to As You Sow, the proposal is part of say-on-climate global investor efforts that press companies to develop net-zero, 1.5°C-aligned GHG reduction goals and climate transition plans for their Scope 1, Scope 2 and Scope 3 GHG emissions.
As You Sow president Danielle Fugere says in a statement following the vote: ‘We are thrilled that management supports reporting on how Boeing’s products will meet the 1.5°C global climate goal. To maintain a thriving and functioning economy, shareholders are looking toward companies like Boeing to demonstrate leadership in setting climate goals – then starting the work of reducing their full range of [GHG] emissions to net-zero by 2050.’
BOARD BACKING
Boeing’s board included a statement in the company’s proxy statement urging shareholders to vote for the proposal. ‘We consider climate change to be an urgent issue and we are devoting significant resources in support of net-zero emissions in Boeing operations and for our industry,’ the board wrote. ‘We have previously demonstrated our commitment to transparency in climate disclosures, and we urge shareholders to support this proposal in furtherance of our efforts.’
The board described Boeing’s goals and approach to Scope 1, Scope 2 and Scope 3 emissions. For example, it stated that, regarding products, the company has pledged that its commercial airplanes will be capable of flying on 100 percent sustainable aviation fuels by 2030. ‘We also support the commercial aviation sector’s ambition to achieve net-zero carbon emissions for global civil aviation operations by 2050. We are partnering across the industry to collectively deliver on our ambition on climate action, enabling a more sustainable future,’ it added.
‘Boeing is actively developing low-carbon transition plans to meet long-term goals with meaningful milestones, and we look forward to continuing to implement the proposal’s objectives by being transparent with our stakeholders on our progress toward these goals.’
A Boeing spokesperson did not have an immediate comment.
Ben Maiden
Ben Maiden is the editor-at-large of Governance Intelligence, an IR Media publication, having joined the company in December 2016. He is based in New York. Ben was previously managing editor of Compliance Reporter, covering regulatory and compliance...
