The Local Authority Pension Fund Forum (LAPFF) has recommended a host of votes against board-supported resolutions at BP’s upcoming annual general meeting, saying the oil and gas company’s actions were raising serious governance concerns.
The association has advised its members to vote against the relatively new chair of the British-based energy giant BP, Albert Manifold, as well as company proposals for virtual-only AGMs and the revocation of binding climate disclosure resolutions.
It said proposals such as these, and BP’s omission of a shareholder resolution from the AGM agenda, raised serious governance concerns.
“LAPFF views these steps as attempts to insulate the board from scrutiny at a time when transparency and robust governance are most needed,” it said.
BP has said the declined shareholder resolution, from activist group Follow This and more than a dozen institutional investors, was not valid.
Another shareholder resolution, coordinated by NGO the Australasian Centre for Corporate Responsibility (ACCR) and co-filed by a number of LAPFF member funds, meanwhile, is on BP’s AGM agenda. It calls on the company to demonstrate how continued spending on new oil and gas projects will deliver value for shareholders.
The Follow This resolution asked the oil major to explain how it will create shareholder value as oil and gas demand falls.
LAPFF’s recommendations come amid reports this week that major proxy advisers Glass Lewis and ISS are also recommending votes against management at BP’s AGM, such as for the ACCR resolution and against the chair.
Legal & General Investment Management, a top 10 shareholder in BP, also this week declared opposition votes, with its justification echoing that of LAPFF’s.
The asset manager said it “acknowledged” BP’s engagement with it over recent weeks about resolutions tabled at the AGM next week.
However, it added that its voting intentions “reflect our ongoing concerns that management recommendations, together with other recent actions including, notably, the non-admittance of the Follow This shareholder resolution, represent a reduction in transparency and constrain the ability of shareholders to understand and price risks associated with energy transition, by limiting both disclosures and opportunities for shareholders to engage directly with the Board”.
Follow This and the pension funds behind the omitted shareholder resolution are calling on investors to vote against a BP proposal to revoke binding climate disclosure resolutions in protest at the company’s decision not to admit their proposal.
BP’s AGM takes place on 23 April.
