CA100+ Calls for Toyota Lobbying Vote

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    Stockholm (NordSIP) – Collaborative engagement initiative Climate Action 100+ (CA100+) is rallying support for a shareholder resolution aimed at the Toyota Motor Corporations’ climate lobbying activities ahead of the Japanese firm’s 18 June 2024 annual general meeting (AGM).  The shareholder proposal has been filed by MP Investment Management (MP Invest) on behalf of its parent AkademikerPension, the pension scheme for Danish academics.

    The shareholder proposal seeks to have the following provision added to the Toyota articles of incorporation: “The Company shall issue a comprehensive and objective report annually (at reasonable cost, omitting proprietary information) describing if, and how, the Company’s climate-related lobbying activities (own direct and indirect through industry associations both in key markets) align, overall, with the goals of the Paris Agreement.  The report should disclose any instances of misalignment with those goals, along with the planned actions to address these.”

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    While recognising that Toyota has begun publishing reports on its approach to climate public policies in recent years, the resolution highlights the fact that these consistently fail to meet the disclosure standards expected by the institutional shareholder community.  The objections are broadly supported by analysis conducted by non-profit InfluenceMap, which rated Toyota’s 2023 report on its climate public policy views a very low score of 21%.  Among the shortfalls addressed by InfluenceMap are a lack of escalation measures where industry associations are clearly misaligned with climate goals.  The report also shows that Toyota has failed to properly review the alignment of its own policy engagement activities, and therefore cannot disclose any form of credible action plan.  The resolution calls for Toyota to implement disclosure and reporting standards in line with the recommendations of the Climate Action 100+ Net Zero Company Benchmarks for Climate Policy Engagement.

    Hybrid v Battery Electric Vehicles

    AkademikerPension has been actively engaging with Toyota for several years in partnership with Sweden’s AP7 and the UK’s Church of England pension fund.  Initial resolutions on climate lobbying were withdrawn based on Toyota’s commitments to produce the requested reporting.  While some progress has been made, for instance regarding the breadth of coverage of the industry associations, AkademikerPension is going ahead with the current resolution as the Danish asset owner believes Toyota is dragging its feet.

    Anders Schelde, Chief Investment Officer at AkademikerPension said: “After dialogue with the company since 2021 we have decided to submit a shareholder proposal on corporate lobbying reporting to Toyota Motor Company for their 18 June AGM.  Continued lobbying in favour of Toyota’s multi-pathway strategy and thereby implicitly against battery electric vehicle mandates creates unnecessary risks for the company and its shareholders, in our view.”

    Toyota has been a strong proponent of hybrid-electric vehicles that continue to rely on the presence of an internal combustion engine, while allegedly campaigning against policy measures aimed at the greater adoption of full battery-electric vehicles.  AkademikerPension fully supports the latter approach, as Schelde explains: “AkademikerPension firmly believes that global policies promoting electric vehicles and binding regulations favouring zero-emission vehicles are imperative to realising the goals of the Paris Agreement.  Ultimately, we believe this favours strategies for battery electric vehicles, and not vehicles relying on internal combustion engines in order to meet the goals of the Paris Agreement.  Consequently, we find it questionable if Toyota’s multi-pathway strategy is the optimal solution to meet these goals and encourage Toyota to report better on how its direct and indirect lobbying align with the scientific pathway to meet the goals of the Paris Agreement.”

    Image courtesy of Raivis Razgals on Unsplash
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