Calling on energy company executives in public and private, responsible investment firm Newton spurs corporate response on ESG issues.
Actively managing investments can help investors identify climate change risks and opportunities. It can also help society tackle global challenges. Driven by these core beliefs, Newton Investment Management, a subsidiary of BNY Mellon, identifies companies that it believes are ineffectively managing their climate-related risks or opportunities, seeks further information and then presses them for action. Often, Newton does this in collaboration with other investors to create a wide-reaching, global impact.
For example, in 2018 Newton and another major investor drafted an open letter to the Financial Times calling for the oil and gas sector to take more action to describe its long-term business strategy and set concrete emission-reduction targets. Issued in early 2018, the letter was supported by 60 asset managers and owners with combined assets of over $10.4 trillion.1
Purposeful ownership is at the core of Newton’s approach to responsible investment.
Following that, Newton focused on one particular energy company. For several years, Newton engaged in a dialogue with this heavy greenhouse gas emitter about improving disclosures on the company’s climate resilience and stranded assets.
After making little progress, Newton, alongside its investor peers in the Climate Action 100+ initiative, co-filed a special climate-change shareholder resolution at this company’s annual general meeting in 2019. The resolution called on the company to address its emissions, provide additional information, and share its business model for a low-carbon world. Years of dialogue finally paid off, as the energy company board supported the proposal and the resolution received near-unanimous investor approval, making clear how important these questions are to shareholders.
1 Call to Action Video Transcript_Newton; Taking Action on the Implications of Climate Change