A British Columbia Investment Management Corporation (BCI) shareholder proposal calling for Imperial Oil Limited to increase disclosure on climate risk received support from 18.89 per cent of publicly traded shares.
A British Columbia Investment Management Corporation (BCI) shareholder proposal calling for Imperial Oil Limited to increase disclosure on climate risk received support from 18.89 per cent of publicly traded shares.
However, the pension investment manager says it is pleased with what it believes is a significant level of support for this first-of-its-kind proposal. Many shareholders share the expectation that resolutions receiving 20 per cent or more of votes should lead to an initial level of responsiveness in practice and disclosure, and engagement between the company boards and investors.
This is the first climate-related shareholder proposal filed by a large Canadian public sector pension investment manager going to a vote at a Canadian company. BCI was the sole filer on the proposal. “Disclosure of accounting assumptions related to climate change and the energy transition is a fast-emerging shareholder expectation,” says Jennifer Coulson, senior managing director and global head, ESG (environmental, social, and governance) at BCI. “We require transparent accounting disclosure in financial statements to make informed investment decisions, including visibility over off-balance sheet liabilities, and Imperial Oil has not provided sufficient information.”
The proposal requested that Imperial Oil’s board of directors provide an audited report estimating the impacts of the International Energy Agency Net Zero by 2050 pathway on all asset retirement obligations by February 2024. Asset retirement obligations are the costs associated with the regulatory requirement to decommission assets at the end of their life. Companies account for certain future costs through financial statements and BCI expects to have visibility of current off-balance sheet liabilities of assets with indefinite useful lives.
