Make My Money Matter has attacked Aviva and Legal & General for “weak stewardship”, following their support of Shell and BP’s management in this AGM season, which it says puts UK pensions at risk.
According to a newly launched Make My Money Matter campaign, Aviva and Legal & General, who manage around £200 billion in savings, supported Shell and BP’s management in 44 out of 45 votes this AGM season, despite them falling short on climate goals.
The campaign highlights that Shell and BP went back on their climate targets while continuing to explore for new oil and gas.
Aviva and Legal & General, who both have climate targets to help limit global warming to 1.5 degrees, voted against Shell’s Energy Transition Strategy for failing to fulfil net zero targets but have continued to back Shell and BP’s leadership and governance by voting “in support of the chairs, CEOs, directors, remuneration, annual reports/accounts and auditors at both Shell and BP.”
According to Make My Money Matter: “Such weak stewardship means they are supporting the leadership of companies whose plans will derail any chance of limiting global heating below 1.5C and will thus undermine the pensions of millions of savers in the future, as well creating a world not fit to retire into.”
The campaign urges pension savers to voice their concerns and calls on the pensions industry and asset managers to take action against oil and gas companies not aligned with science-based net-zero targets.
The criticism is a challenge to the providers, both of which have taken steps to promote their ESG activities. Aviva has a net zero target of 2040, ten years earlier than virtually all other DC pension providers. Its stewardship activities have seen it vote against the board in 25.5 per cent of occasions in the year to 30.6.23, according to the Corporate Adviser ESG in DC Pensions Report (click for a copy), the highest proportion in the DC universe. Legal & General Investment Management voted against the board on 23 per cent of occasions, the second highest. LGIM achieved a high level of stewardship activity relative to its size, amongst asset managers operating in the DC universe.
In response to the criticism, LGIM commented: “As a large, global asset manager we take our role as a responsible investor on behalf of our clients very seriously. Climate change is a critical issue of global concern. We engage actively and constructively with companies on the transition to a low carbon, net-zero economy.”
Make My Money Matter CEO Tony Burdon says: “Given the climate leadership Aviva and Legal & General have shown in recent years, we were shocked to see their almost complete support for Shell and BP at this year’s AGMs. In a climate and nature emergency voting in support of fossil fuel companies that are not seriously transitioning to 1.5C puts the pensions and retirement of millions of UK savers at risk, and the world they retire into. We call on the UK pensions industry to vote against the Chairs, Directors, remuneration, auditors and plans of these companies.”
Aviva was contacted for comment.