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Jun 20, 2023

Toyota shareholders shrug off climate support in AGM vote

Resolution called on car maker to align ESG goals with Paris Climate Agreement

Shareholders at car manufacturer Toyota voted against a climate resolution that would have seen the company take a more serious stance on reducing its carbon footprint.

At the AGM, held last week, shareholders voted against resolution four, which called on the $258 bn company to align its ESG goals with the Paris Climate Agreement, which attempts to limit global warming to 1.5°C by the end of this century. It was signed by 196 parties at the UN Climate Change Conference in Paris on December 12, 2015.

In the original filing of the proposal, resolution four stated that while it appreciated that the company published an updated report on climate lobbying in December 2022, it fell ‘far short of investor expectations’.

The resolution said: ‘Such disclosures could serve to mitigate reputational and other risks, including potential backlash from customers, business partners, employees and investors associated with the company’s climate-related lobbying activities in recent years.’

Achieve carbon-neutrality

The Toyota board argued that instead of aligning with this agreement, the best way to achieve stronger climate goals is through the mass-market adoption of electric vehicles.

‘We aim to achieve global sales of 3.5 mn units of battery electric vehicles per year by 2030 and at least halve global CO₂ emissions from new vehicles, including those from emerging countries, by 2035,’ the board said.

It pledged to carry out a variety of carbon-neutrality measures in a bid to become carbon-neutral by 2050 but noted that the role of government and public policy would be critical in achieving this goal.

‘We very much welcome increased and open dialogue with the proposing shareholders, other institutional investors and environmental non-governmental organizations for the best possible mutual understanding on how we, together, effectively and concretely activate a variety of measures to achieve carbon-neutrality,’ the board added.