Investors push Amazon for more information on its climate footprint
Two investors have filed a shareholder resolution with Amazon, requesting that the online retail giant measures and discloses emissions from its full value chain – including products it stocks from third-party brands and sellers.
The resolution, filed on Monday (19 December) by Amalgamated Bank and Green Century Capital Management, was developed and filed with support from shareholder advocacy non-profit As You Sow.
The resolution acknowledges that, while Amazon does produce an annual sustainability report including global emissions data from across the value chain, the corporation is not accounting for the value chain emissions of the products sold on its platform beyond its own branded products (such as Alexa smart devices, Kindle e-readers and own-brand fashion lines). The investors note that products from other brands and sold by third-party sellers account for the vast majority of Amazon’s annual sales, meaning that any credible climate plan and accounting should include emissions resulting from their upstream and downstream value chains.
“By not disclosing the emissions from the vast majority of the products it sells, Amazon’s exposure to climate risk is much larger than its current emission disclosures capture,” As You Sow has stated. The absence of this information, it argues, prevents investors from making considered decisions.
The resolution, if passed, would press Amazon to disclose emissions from all product sales. It would also press Amazon to develop approved science-based targets for reducing emissions this decade. Amazon first indicated a wish to set targets through the Science-Based Targets Initiative (SBTi) in 2020 but has not yet gotten approval. There are strict requirements on the scope of targets aligned with 1.5C from the SBTi, ensuring that businesses account for their indirect (Scope 3) emissions.
A vote on the resolution is likely to be held at Amazon’s 2023 Annual General Meeting (AGM).
“Amazon is trying to claim a leadership spot in the corporate race to net-zero emissions but is not disclosing all of its greenhouse gas emissions, leaving investors to wonder whether Amazon is a climate risk rather than a climate leader,” said Green Century Captial Management’s shareholder advocate Andrea Ranger.
edie has reached out to Amazon for a comment on this story.
As You Sow has previously facilitated several other resolution filings at Amazon. Earlier this month, it helped shareholders request information on the climate risks associated with its 401k retirement plan of choice, the Vanguard Target Retirement funds. These funds have been linked by environmental researchers and campaigners to fossil fuel activity and projects in sectors at high deforestation risk. Back in Spring, almost half of shareholders at Amazon.com backed an As You Sow resolution regarding the disclosure of information regarding how much plastic packaging the retailer uses.
Amazon’s overarching climate target is to reach net-zero across the value chain by 2040. It calls this target its ‘Climate Pledge’ and has engaged with more than 300 other companies to get them to commit to net-zero in or before 2040.
Accounting towards the Climate Pledge, the investors understand, excludes calculations of all emissions from the value chain of third-party products. It includes calculations of emissions from logistics, but not from raw materials, manufacturing or product use.
Even without reporting on these emissions, Amazon has reported an increase in its global emissions in recent years. The company posted an 18% year-on-year increase in its absolute carbon dioxide (CO2) emissions this August and attributed this to business growth. It reported a 26% year-on-year increase in Scope 1 (direct) emissions; a 23% decrease in Scope 2 (power-related) emissions and a 14% increase in Scope 3 (indirect) emissions.
This came after a 19% year-on-year increase in absolute emissions across all Scopes in 2020, documented in Amazon’s sustainability report from the summer of 2021. Amazon has maintained that it will still be able to meet its 2040 target and has highlighted that is has decreased emissions intensity.
“Amazon’s challenges in delivering on its climate commitments reflect the uphill task our economy faces in decarbonising, but investors expect more from a company of this size and capacity,” said Amalgamated Bank’s chief sustainability officer Ivan Frishberg.
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