In The News Research & Reports Alerts & Blog About
Mutual Funds and Climate Change: The Leaders and Laggards

This year saw a record high in mutual fund support for climate-related resolutions tracked by Ceres (Mutual fund companies show record high support for climate change shareholder resolutions).

Voting records show that mutual funds voted favourably 29% of the time in the 2013 proxy season, an all-time high for the annual survey conducted by Ceres and Fund Votes.

However, this doesn’t signal a tide change in mutual funds’ position on climate risk – overall support reached 27% in two previous proxy seasons in the 10-year survey – and this figure obscures the vast disparity in voting amongst the largest of the mutual fund asset managers – 42 fund families were surveyed.

On the one hand there’s Deutsche Asset and Wealth Management (DWS) which supported every one of the climate-related shareholder sponsored resolutions on which it voted in the 2013 proxy season. On the other hand there’s Vanguard which has never supported a single such resolution in the 10 years of the survey.

In between are eight fund groups that supported more than 50 percent of climate resolutions on which they voted in 2013 and eight, besides Vanguard, that either abstained or voted against all climate resolutions.

A read of the proxy voting guidelines published by these asset managers doesn’t help in understanding the apparent disparity in reasoning behind climate voting. Of the 42 fund groups surveyed, only two examples of guidelines that actually even mention climate change were found.  Given that so many shareholder resolutions address this issue each year (over 140 have come to vote in the last 3 years and usually at large and widely held companies), it seems that some explicit guidance in this area, or at least some consideration in the guideline review process, is absolutely essential.