Updated with comments from UBS and BlackRock

Some of the largest asset managers operating in Switzerland including BlackRock have failed to take action in resolutions at companies on biodiversity loss and climate issues, a Greenpeace Switzerland report has said.

The environmental campaign group analysed the voting behaviour of 10 asset managers operating in the country in 2023, finding that they fell short of voting in favour of nature in resolutions on the topic.

“Despite the increasing urgency of the climate and biodiversity crises, asset managers are failing to fully assume their responsibility for the companies they invest in,” the report said.

“Asset managers are supporting environmentally destructive business activities with severe consequences for people and the planet.”

Greenpeace examined votes on specific resolutions cast by UBS, Credit Suisse, Pictet, Vontobel, Swiss Life, Swisscanto, Lombard Odier, BlackRock, AXA, and GAM.

“UBS and BlackRock evidenced the worst performance. Both asset managers only exercised their voting rights to the benefit of climate and nature in one of 10 of the resolutions assessed,” it said.

According to the report, both asset managers voted in at least six resolutions in 2023 supporting “a climate/environmentally harmful strategy or chair of the board”.

These actions include votes on TotalEnergies’ “insufficient plan for sustainable development” as well as the re-election of mining firm Glencore’s board chair, who had been questioned due to “inadequate measures to protect the environment and climate”.

“UBS and BlackRock are clearly sending the wrong signal to investee companies,” Greenpeace said.

“Regarding the re-election of chairpersons of companies with acute deficiencies in their climate strategies and environmental measures, none of the examined asset managers consistently voted for the chairperson’s removal.”

However, New York-headquartered BlackRock has a supportive voting policy stance for nature in its 2024 guidelines for US securities, according to an assessment by Morningstar published this month.

Zurich-based UBS suggested investors “generally support” resolutions on reporting on company policies related to biodiversity, including deforestation, in its 2023 summary voting policy.

“Our long-established climate engagement program, currently focused on 75 companies in high emitting sectors, has had demonstrable outcomes as a result of constructive and meaningful dialogues,” UBS told Carbon Pulse.

“As an active owner, if we do not consider that sufficient progress has been made, we are able to utilise a number of options. This may include withholding our support for the board chair at the AGM vote.”

“Climate and nature-related risks can be material for companies’ ability to deliver durable, long-term financial performance,” said BlackRock.

“We therefore look to companies to disclose how they identify and manage these risks and capture potential opportunities. As a fiduciary, we vote based solely on our assessment of what is in the best long-term economic interests of our clients.”

LACK OF TRANSPARENCY

Greenpeace also emphasised the lack of transparency among some of the assessed asset managers.

Vontobel’s voting results from 2023 remained unpublished as of the end of Feb. 2024, preventing investors from reviewing its decisions, according to the report.

“At Swiss Life, Swisscanto, GAM, and Lombard Odier, no rationales were found for the voting results of the previous proxy season. These asset managers thus do not enable a determination of whether climate and other environmental considerations actually influence their voting behaviour.”

“Furthermore, none of the 10 asset managers commits to specific voting behaviour in the case of inadequate corporate strategies regarding … deforestation or water pollution.”

Greenpeace called on asset managers to vote in favour of resolutions that commit companies to implementing no-deforestation strategies, and assessing and mitigating environmental impacts.

“Proposals from management or shareholders that restrict or impede upon these requirements must be consistently rejected. Those responsible in management, or on the board of directors who obstruct these commitments over the years, must be held accountable.”

Lately, asset managers have come under increasing pressure to drive action on biodiversity within their investees.

A report published by the responsible investment charity ShareAction last year showed that global asset managers have largely ignored nature-related risks and failed to align portfolios with net-zero pathways.

Responsible investor groups, such as the Principles for Responsible Investment (PRI) and Nature Action 100, have launched initiatives in recent months to ramp up corporate engagement on biodiversity loss.

By Sergio Colombo – sergio@carbon-pulse.com

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