Climate change continues to be one of the main areas of our ethical work. We co-filed a shareholder resolution at BP’s AGM, calling on the company to explain how it will align with the Paris Agreement. The resolution secured the BP board’s backing and was passed with 99.47% of votes. We also supported a resolution organised by the activist group ‘Follow This’ calling on BP to go further, including publishing Scope 3 emissions targets; unfortunately, this only secured the backing of 8.35% of investors.
We attended the Anglo American AGM, where we made a statement on behalf of the Climate 100+ investor coalition; we co-lead on engagement with Anglo American. This is part of an ongoing dialogue being lead by the CFB and Hermes in regard to Anglo American’s transition to a low carbon economy. This involves biannual meetings with the company to raise issues related to climate change, including climate linked remuneration, scope 3 emissions, and the reduction of coal mining. We look forward to the next meeting with Anglo American.
We continue to work on our project to evaluate the consistency fossil fuel companies’ business models with the Paris Agreement. We remain on track to draw final conclusions in 2020. With the launch of the new Global Equity Fund for Charities, we had to undertake an interim judgement on a number of global oil companies and decided that some would be highly unlikely to meet the criteria and so excluded Chevron, ConocoPhillips and ExxonMobil from investment.
We have already excluded several other fossil fuel producers under our existing policies and it is likely we will exclude further companies in future. However, we are aware that some clients want to move faster so we are consulting on the potential for launching a fund which excludes all companies with significant involvement in fossil fuel extraction.
The approach banks have been taking with their lending policies and climate change has been another area of focus. We have engaged directly with the Canadian banks to which we have exposure with respect to their lending to companies involved in tar sands projects, and found their responses to be disappointing. We are reflecting on the next steps. We have also joined other investors in writing letters to Barclays and Unicredit regarding their lending to fossil fuel projects.
The tailings dam disaster near Brumadinho in Brazil earlier this year remains very much in the minds of investors. We are part of an investor coalition organised by the Church of England which engages with mining companies on their tailing dams. This initiative has seen letters sent to 651 listed mining companies, in order to create a global register of tailings storage facilities. This is designed to raise awareness of the tailings facilities that the company owns or operates in order to see which company has responsibility for the facilities, and the scale of the risks that it faces. As of 5 July 2019, 31% of companies contacted have responded, and we were pleased to see that included 34 of the top 50 mining companies. We continue to be active in this coalition.
The Mining and Faith Reflections Initiative (MFRI), of which we are part, organised a conference in the Vatican on Mining and the Common Good. Delegates included church, NGO, and local community representatives along with mining CEOs and other executives.
We have been engaging with tea producers for some time, recognising the abuses that can take place within the sector. We wrote to Unilever to ask for greater transparency on the estates from which it sources tea and requesting this to be disclosed publically. We were pleased to receive a response from Unilever, which confirmed that the company will now publish the tea estates it sources its UK and Ireland tea from on its webpage.
We continue to monitor investment issues with respect to Israel Palestine, applying our dedicated policy. We had engaged for some time with Heidelberg Cement; however for unconnected reasons our funds no longer hold shares in this company.
As part of our work with ShareAction, we engaged with Reckitt Benckiser and Intercontinental Hotels Group in June to encourage both companies to become Living Wage accredited. We look forward to hearing their responses in due course.
We have continued to engage with companies on the issue of plastic pollution. We contacted Ted Baker about the use of plastic micro fibres used in the clothing industry. These can end up in oceans. In its response, Ted Baker highlighted its commitment to using sustainable fibres where possible and it noted that natural fibres can also have negative impacts from the use of natural resources such as water. We co-signed a letter to 50 global consumer goods companies organised by As You Sow, an American NGO, encouraging them to complete a survey on plastic packaging, to allow an assessment of their approaches.
The PRI annually undertakes an assessment of its members’ approaches and activities with respect to responsible investment. We achieved A+ ratings for our overall ESG strategy and governance, A+ for our approach with indirect holdings, A+ for our incorporation of ethics into our management of our equity holdings, and As for active equity and corporate bond ownership.
Q2 was a busy quarter for voting with many companies holding their AGMs. Our voting policies resulted in voting against three quarters of remuneration reports in the UK, in many cases because of excess levels of remuneration. We oppose the election of directors where policies or outcomes on remuneration, board diversity, tax transparency, climate change or corporate governance are particularly poor. This resulted in opposing 14% of directors in the quarter. Our voting policies are applied to all of our holdings in the new Global Equity Fund as well as our UK Funds.