Umpqua Holding Corp. – Assess/Report GHG Emissions (2015)
Outcome: Withdrawn following a commitment from the company to engage in ongoing dialogue on the issue.
Banks and other financial institutions contribute to climate change through their financed emissions, which are the greenhouse gas footprint of loans, investments, and financial services. A bank’s financed emissions can dwarf its other climate impacts and expose it to significant reputational, financial and operational risks.
In order to safeguard long-term fiscal health, we believe banks must have a comprehensive understanding of their own exposure to climate-related risks and opportunities. They must accurately analyze risk levels in their lending models and develop strategic management plans that consider the implications of climate change for both credit and risk assessments as well as positive climate-related opportunities.
As investors, we are concerned about potential long-term, climate-related risks, including: inaccurate risk assessments, unanticipated project costs, changing regulatory environments, legal and reputational risks, uncertain demand for high-carbon fuels, banker incentive misalignment, and unpredictable, extreme weather patterns.
Umpqua Holding Corporation has emphasized the importance of climate change management in its brand reputation by joining the Oregon Business Climate Declaration which states: “There is a clear and present need for action on climate to protect our region’s natural assets, its vibrant communities and its growing economy. We business leaders of the Pacific Northwest endorse the Climate Declaration because we support using energy efficiently, investing in cleaner fuels, advancing renewable energy, and reducing greenhouse gas emissions.”
However, Umpqua has not provided investors with information to permit meaningful assessment of the risks presented by its financed emissions. For example, Umpqua does not provide meaningful information regarding its integration of climate change considerations into its risk management processes; its identification of opportunities associated with climate change; or its long-term climate change strategy.
RESOLVED: In light of Umpqua joining the Oregon Business Climate Declaration, shareholders request that the Board of Directors report to shareholders by September 2015, at reasonable cost and omitting proprietary information, Umpqua’s assessment of the greenhouse gas emissions resulting from its lending portfolio and its exposure to climate change risk in its lending, investing, and financing activities.