- Standard Bank’s Notice of Annual General Meeting, released on 17 April 2019, includes a resolution proposed by shareholders* that would require the bank to prepare a report on its exposure to climate risk in its lending, financing and investment activities.
- This is the first time that a South African company has tabled a shareholder resolution on any climate-related issue.
- Shareholders will vote on the resolution on Thursday morning during Standard Bank’s AGM at HP de Villiers Auditorium, Ground Floor, Standard Bank Centre, 6 Simmonds Street, Jhb, starting at 09h00. The results will be announced at the AGM.
- The resolution was proposed by the RAITH Foundation and shareholder activist, Theo Botha.
At Standard Bank’s AGM on 30 May, shareholders will for the first time, vote on South Africa’s first ever climate risk-related shareholder resolution. Resolution 10 in Standard Bank’s Notice of AGM was proposed by activist shareholders the RAITH Foundation and Theo Botha, with support from responsible investment and shareholder activism NGO Just Share.
If more than 50% of Standard Bank’s shareholders vote for Resolution 10 on 30 May, the bank will have to:
- a) provide shareholders with more meaningful information about the climate-related risks they are exposed to by investing in the bank, through the bank’s lending, investing and financing activities in relation to fossil fuels; and
- b) adopt and publicly disclose a policy on lending to coal-fired power projects and coal mining operations.
Why is it important?
Around the world, shareholder resolutions have become one of the most powerful tools for raising awareness about climate change risk, and for driving the business and financial sectors to take action to understand, mitigate and avoid that risk.
South Africa is one of the world’s biggest carbon emitters, and many of the biggest companies listed on the JSE are extremely carbon-intensive, i.e. they emit huge quantities of greenhouse gases. Many of the financial institutions that invest in these high carbon emitters and lend money to them are themselves listed companies.
Standard Bank describes itself as the “leading oil and gas bank in sub Saharan Africa”. In other words, it is heavily involved in lending money to fossil fuel development and extraction across Africa. Every rand invested by banks in fossil fuel projects increases climate risk and makes it harder to achieve a just transition to a low-carbon economy.
Asset managers and asset owners who claim to be responsible investors will, for the first time in relation to a South African company, have to take action which will indicate how serious they really are about engaging with climate risk in their investment decision-making.
Many of South Africa’s institutional investors are signatories to and/or have publically declared support for responsible investment initiatives like the Principles for Responsible Investment (PRI) and the Code for Responsible Investment South Africa (CRISA).
This vote will demonstrate how seriously they take these commitments.
Author: Bryan Groenendaal
If you are interested in attending the AGM, please note the following details:
Date: Thursday 30th May 2019
Address: HP de Villiers Auditorium, Ground Floor,
Standard Bank Centre, 6 Simmonds Street, Johannesburg