WSJ has an article about environmentalism’s growth in corporate board.
Environmentalism Sprouts Up
On Corporate Boards
More Companies Start
Panels on Green Issues
Amid Push by Activists
By JOANN S. LUBLIN
More U.S. corporate boards are going green.
Amid rising investor worries over global warming and shrinking natural resources, directors are keeping a closer watch on environmental issues. Boards at Integrys Energy Group Inc., Quicksilver Resources Inc., Tesoro Corp. and elsewhere recently have created separate environmental panels -- joining long-established ones at DuPont Co., Occidental Petroleum Corp. and Rohm & Haas Co. Other companies cover environmental issues with an existing board committee.
About 25% of Fortune 500 companies now have a board committee overseeing the environment, compared with fewer than 10% five years ago, estimates Mindy Lubber, president of Ceres, a national coalition of activists, investors and others concerned with the environment. Such panels typically try to make sure that executives effectively handle conservation efforts, new environmentally friendly ventures like wind power, compliance with environmental regulations and related business risks.
And, how shareholders are creating pressure.
Shareholders are more active on environmental issues, too. The number of investor proposals related to the environment nearly doubled between 2004 and 2008, RiskMetrics Group Inc. says. Many proposals urge increased board attention to the issue.
The Earth's sustainability "has become a much more important part of every board's activities," observes Lester A. Hudson, chairman of American Electric Power Co.'s governance committee, which monitors environmental concerns.
AEP's experience illustrates the new dynamic. The electric utility, based in Columbus, Ohio, is among the largest U.S. users of coal -- and emitters of greenhouse gases.
In November 2003, public-employee pension funds offered a shareholder resolution urging independent directors to assess how AEP would deal with potential regulations to reduce carbon dioxide and other power-plant emissions. Mr. Hudson says three fellow directors formed a special panel to do a study, prompting the unions to drop their proposal.
So, even though you may be frustrated in your company that executives are not listening to you internally, pressures are building from shareholders to address environmental issues. Don’t be surprise you start to see executives you checked with months ago, changing their tunes on green/sustainability initiatives.