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Statement on the AES Shareholder Vote

Yesterday at the annual meeting of utility AES, shareholders had their first chance to vote on a resolution asking a U.S. based company to stress test its investments against the low carbon future that the Paris agreement will help bring about. The resolution received support from 42% of investors, the highest vote ever for a 2 degree stress testing resolution in the U.S.
by Shanna ClevelandCeres Posted on Apr 20, 2016

As over 160 nations gather to sign the most far-reaching climate agreement in history, a coalition of global investors sent a clear message to fossil fuel companies: the time to adapt for the energy transition is now.

Yesterday at the annual meeting of utility AES, shareholders had their first chance to vote on a resolution asking a U.S. based company to stress test its investments against the low carbon future that the Paris agreement will help bring about. The resolution received support from 42% of investors, the highest vote ever for a 2 degree stress testing resolution in the U.S. “Investors recognize that the Paris Agreement marked a turning point, and we need to know how companies are planning to succeed and create opportunities to provide clean energy in this new environment,” said Pat Zerega of Mercy Investment Services, the filer of the resolution. "We’re looking forward to working with AES on this important issue.”

This proxy season, shareholder proposals on climate risk are being propelled by a powerful set of tailwinds: an historic climate accord, rapidly changing market forces, and unprecedented shareholder collaboration. Some of the most powerful voices in the fossil fuel industry, including the Saudi Oil Minister Ali Al-Naimi, are convinced the sector is facing an existential threat. The Secretary General of OPEC is advising its members to look for opportunities to diversify their economies and move away from reliance on oil revenues. In this context, one would assume that western energy companies would be taking aggressive steps to ensure their economic viability in a rapidly decarbonizing world. Now is the time for their boards and executives to chart a path forward for resilience to a future where temperature rise is limited to well below 2 degrees Celsius, as the rest of the world envisions.

Similar resolutions are slated for votes in the coming weeks at Noble Energy, Occidental Petroleum, Anadarko, First Energy, Chevron, ExxonMobil, and Southern Company. Investors around the world have pledged their support of carbon asset risk resolutions at these companies, and if the vote at AES is any indication, momentum is growing rapidly.

Learn more and pledge your support at http://www.ceres.org/issues/carbon-asset-risk/investor-support-of-portfolio-resilience-resolutions.

Read the post at Ceres

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Meet the Expert

Shanna Cleveland

Shanna Cleveland is a Director at Ceres where she leads the work on the Carbon Asset Risk (CAR) Initiative. The CAR Initiative, launched in 2013 in collaboration with the Carbon Tracker Initiative and with the support of the Global Investor Coalition on Climate Change, aims to prevent shareholder capital from being wasted on developing high-carbon, high-cost fossil fuel reserves that cannot be burned if the world is to avoid catastrophic climate change and drive fossil fuel companies to acknowledge and plan for the escalating physical impacts of climate change such as sea level rise, stronger storms and more severe droughts.

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