Major U.S. banks face climate change vote

Shareholders are set to vote on proposals to reduce financing for projects in oil and gas. The banks include JPMorgan Chase, Bank of America, Wells Fargo, Citigroup, Goldman Sachs, and Morgan Stanley.

Why should we care?
Submitted by activist shareholders, these proposals aren’t binding, and they face resistance from banks and the majority of shareholders. But these votes can still have a significant effect on banks (and fintechs) in the long run. For one, the votes will let activist shareholders understand which key investors they need to negotiate with for future votes. And, with enough votes, activist shareholders can get banks to come to the table and discuss revisions to their climate policies. “It’s like this dance where you see what kind of votes you get, and you see what the banks are willing to move on,” said Paul Rissman, a member of the Sierra Club Foundation board of directors. “It’s a long cycle of negotiation.” Meanwhile, for fintechs, this news offers an opportunity to further differentiate themselves from establishment banks by highlighting their green policies and products. In much the same way that fintechs have pressured banking giants to unroll new products and innovate technologically, they can force banks to respond to ecological realities and support net-zero policies.