Institutional investors have renewed calls for FTSE 100 companies to provide shareholders with a vote on their climate risk and resilience strategies amid signs that corporates are pulling back.
Asset manager CCLA and the Local Authority Pension Fund Forum (LAPFF) have coordinated a letter signed by more than 50 investors, including Brunel Pension Partnership, Church of England Pensions Board, Ethos Foundation, LGPS Central, NEST and PKA.
The letter highlighted the guidance from the Transition Plan Taskforce, now under the International Sustainability Standards Board (ISSB), which recommends that companies update and disclose their plans on a three-year cycle.
So far only five FTSE 100 companies offered shareholders an annual general meeting (AGM) vote on their transition plan votes in 2025, after a high point in 2022 when 14 FTSE100 put their transition plans amid post-COP26 enthusiasm.
“Any retreat from shareholder votes on climate strategies undermines our ability to hold boards accountable for managing risk,” Doug McMurdo, chair of LAPFF, told IPE.
“Central and local governments are expected to plan for and build resilience against the physical impacts of climate change – and we expect the companies our local authority pension funds invest in to do the same.”
Tessa Younger, environment stewardship at CCLA, said the letter aims to ensure climate is a key business strategy issue.
“The science is clear. Emissions are still rising, so it is still imperative that this is considered as a key business strategy issue,” said Younger. “Every point one of a degree matters, and we need that granularity.”
She added: “A transition plan brings that to life and lets investors engage with the issue and see that it’s meaningful, not just high-level. We want a more detailed plan on how you’re going to get there, particularly the capital expenditure companies are going to have to implement their transition plans.”
Last year, the LAPFF and CCLA coordinated a similar investor-backed letter to FTSE 100 companies that had not held a shareholder vote within the previous three years.
Of the 76 companies contacted, 49 responded, with only two committing to hold a shareholder vote at a future AGM while 27 said they would keep it under review.
There were 17 companies that responded to say that they would not put their transition plans to a shareholder vote.
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