Stakeholders resolved in December to have the bank explain the policy about financing oil-sands. Thus, the loss might incur and whether the move is consistent with the 2015 Paris Climate accord.
Some stakeholders want JPMorgan Chase & Co. to disclose the risks involved in its lending and financing of oil-sands producers and pipeline companies. One of the concerns among these stakeholders is that the actions to finance and lend companies. However in these operations are against the banks commitments to fight climate change.
The company increased funding for oil-sands producers and pipeline companies to $8.4 billion from 2014 to the third quarter of last year. Stakeholders resolved in December to have the company tell of the financial risks it may face from the investments. In general, the resolution asks the bank to prepare a report on losses it might incur if the oil is not produced.
Bank seeks SEC approval to drop request
The bank is also to explain whether the financing is consistent with the 2015 Paris climate change accord, the bank’s policy on indigenous people’s rights and if the bank can reduce risks by adopting a policy similar to other banks.
For instance, not only has the bank supported climate change fighting initiatives. Although it commits to buying and financing clean energy. It resolved to also reduce coal-industry work.
Oil-sands not only is most carbon-heavy forms of petroleum but also disrupts indigenous communities and leveled forests.
Despite the move by stakeholders, the bank did not list the resolution in JPMorgan’s preliminary proxy this week. The bank said in a letter dated January 12 that the resolution amounts to micromanagement. It would interfere with their operations and so inappropriate to SEC rules.
CEO OF Proxy Impact — the group that is working with shareholders — Michael Passoff, said the it is first time the company is not including the resolution in their preliminary proxies. They do not include a disputed resolution when SEC has not weighed in according to him.
The stakeholders, on their part, explained that they are not requesting for a policy to ban or limit the financing by the bank. Instead, they are requesting an assessment of the oil-sands work, and its merits relative to larger societal debates. They said their concern is consistent with increase in climate change concerns in the financial sector.