Last month, Amazon employees used their company-issued stock to pressure top executives into reducing contributions to climate change. Amazon’s proxy statement, released on 11th April, includes an employee-backed resolution asking the company to report publicly on how it plans to reduce its reliance on fossil fuels and manage the risks posed by climate change.
The supporters also released an open letter signed by more than 7164 employees calling on CEO Jeff Bezos and the board of directors to support the resolution. In the letter, the employees also asked Amazon to stop offering its cloud services to the oil and gas industries.
On 10th May, Amazon Employees for Climate Change Justice group tweeted that two of the largest proxy advisors to institutional investors have recommended shareholders to vote Yes to their resolution.
Amazon employees have made a proposal which states, “Amazon’s Board of Directors prepare a public report as soon as practicable describing how Amazon is planning for disruptions posed by climate change, and how Amazon is reducing its company-wide dependence on fossil fuels. The report should be prepared at reasonable expense and may exclude confidential information.”
Glass Lewis have recommended the shareholders to vote in favor of this proposal. It has specified in its recommendations that, “The Company has provided some level of disclosure concerning some of its environmental initiatives, but we find this disclosure to fall short in many respects.”
However, Glass Lewis also states that they do not believe that this disclosure addresses what they view as the heart of this proposal, which is how the Company plans to mitigate disruptive risks resulting from climate change. They believe that issues, including extreme weather patterns, a more stringent regulatory framework on climate-related issues and changing public perceptions on account of climate change, can all have real and disruptive effects on companies. Further, as evidenced by the submission of this resolution and the aforementioned employee letter, the Company’s apparent inaction on issues of climate change can present human capital risks, which have the potential to lead to the Company having problems attracting and retaining talented employees.
Lastly, according to Glass Lewis the additional disclosure requested by the proposal would benefit the Company by allowing shareholders to better understand how the Company is ensuring resilience to climate-related disruptions and would provide reassurance to employees that issues related to climate change are being taken seriously.
ISS also states, “Publication of the report requested by shareholders would allow shareholders to better assess the company’s management of its risks related to climate change and actions to reduce its GHG emissions in line with Paris Agreement goals.”
Dr. Friederike Otto from Oxford states, “There is absolutely no doubt that when there is a tropical cyclone…because of climate change the rainfall intensities are higher…the resulting flooding is more intense than it would be without human-induced climate change.”
Read the recommendation letters by Glass Lewis and ISS in response to the Amazon employees proposal.
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