The Columbia Journal
P.O. Box 2633 MPO,
Vancouver, British Columbia,
Canada V6B 3W8
Shareholder Action Update: Civilizing the Banks
As Canadians we all love to hate the Banks. But as virtual proxies for
the whole Canadian economy through their lending and underwriting
activities, their business is a prime target for shareholder action.
The “Responsible Finance” campaign is now in its second year. While not
very “sexy,” it is one of the most important initiatives social impact
investors can undertake in Canada, and in year two it has begun to
produce some surprising results.
While at least one bank (TD) continues to resist by refusing to
circulate the Real Assets shareholder resolution this year, other banks
are showing serious interest in its request for greater transparency
around their policy and practice on environmental issues and risks
related to their lending and underwriting. Senior board level
commitments at CIBC led to the withdrawal of the proposal earlier this
year, while over at the Bank of Montreal, management took the
unprecedented step of recommending its shareholders vote FOR the
This resulted in a Canadian first for an environmental or social
shareholder resolution, and a 91 per cent Yes vote. Of course, progress
comes with actions, not resolutions, so we will be carefully monitoring
the big five banks’ progress on these issues over the next year.
This aspect of the Responsible Finance campaign ties in directly with
the Climate Change Campaign:
Munich Re, the world’s largest re-insurance company, estimates that
direct climate change related losses (if we don’t get with Kyoto and
more, soon) could reach $400 billion annually. Green house gas emitters
could well face multi-billion dollar lawsuits, just as we have seen for
years in the Tobacco and Asbestos industries. And although our campaign
has targeted the oil patch in Canada (filing with PetroCanada and
Nexen), many industries will be affected if we don’t get serious about
climate change. Including tourism, agriculture, banking and insurance
just to start the list.
Shareholders will get serious when they begin to understand the
magnitude of risk to their shares’ value if nothing is done, and
everything to gain, both in share value and quality of life on this
planet, if we do make change. We look forward to shareholder response
from PetroCan and Nexen later this spring.
HIV/Aids in Africa, glass ceiling issues in Canada, responsible water
use, and human rights shareholder campaigns are all still very active,
and I’ll report on some of them next issue. Remember, it is the
platform of funds like the Real Assets Social Impact fund and their
institutional pension funds that fuel these campaigns, so visit
www.realassets.ca for more.
Perry Abbey is a
portfolio manager at United Capital Securities, a Working Enterprises
company. Helping individuals and organizations harmonize their money
with their values and leverage capital for change. Real Assets is
Canada’s first Investment Management firm solely focused on Social
Investment, and is both a VanCity and a Working Enterprises company.