Business

EOS Hermes says yet to decide on MUFG climate shareholder resolution

EOS at Federated Hermes has yet to decide if it will back a shareholders’ resolution sponsored by activists seeking to push Mitsubishi UFJ Group to align itself with global climate change goals, the asset manager said.

EOS Hermes, which is in talks with the bank, spoke exclusively to Reuters after MUFG said this week that it aimed to achieve carbon neutrality in its lending by 2050.

“We believe the wording and request of the shareholder resolution appear sensible and in line with our engagement with the bank,” said Sachi Suzuki, Japan lead engager for EOS Hermes, which has assets of $1.5 trillion under advice.

EOS Hermes welcomed Monday’s announcement, along with the bank’s commitment to align its business with the goals of the 2015 Paris accord on climate change, Suzuki added.

“We, however, have some remaining concerns,” Suzuki told Reuters in an email late on Wednesday. “We will continue to engage with the bank before we make our final decision about voting recommendations.”

Suzuki was referring to a shareholder resolution submitted to the bank by Japanese non-government organisation Kiko Network and Rainforest Action Network, for a vote at its annual general meeting (AGM) in June.

Contacted for comment by Reuters, MUFG said it acknowledged receipt of the shareholders’ resolution and was formulating its response for the AGM vote.

Investors concerned about the impact of climate change are increasingly using such resolutions to push banks to withdraw from funding fossil fuels such as coal, making mines and coal-powered power stations unattractive investments.

Kiko Network said it would pursue the resolution after talks with the bank following its announcement on carbon neutrality.

EOS Hermes represents 0.85% of the shares in MUFJ on behalf of its clients, although it does not give advice on voting to all those shareholders.