At a shareholder meeting last week (June 2) held by Arkansas (U.S.)-based multinational retail giant Walmart, 5.5% of investors – a significant percentage – voted in favor of a proposal calling on the company to accelerate its plans to reduce refrigerants released from its operations, in particular HFCs.
The vote was reported in a blog by the Environmental Investigation Agency (EIA). EIA and Green America had previously issued a brief urging shareholders to vote for the proposal, which was filed by Rhode Island Treasurer Seth Magaziner. This is the first time Walmart shareholders have ever voted on a proposal relating to refrigerants and their climate impacts.
According to EIA, the 5.5% vote is significant because a first-year resolution only needs to meet a 5% threshold of support to be considered again at next year’s shareholder meeting. “This puts considerable pressure on Walmart to listen to concerned shareholders and take action on HFCs,” said EIA, which added that Walmart had advised its investors to vote against the resolution.
The proposal reads as follows:
“Shareholders request that Walmart issue a report, at reasonable cost and omitting proprietary information, describing if and how it plans to limit its impact on climate change by increasing the scale, pace and rigor of its plans to reduce refrigerants released from its operations.”
In addition, reported the EIA/Green America brief, the proponents of the proposal “believe meaningful disclosure could include consideration of the benefits and drawbacks of approaches” such as:
– Plans for adoption of a near-term, quantitative target to reduce refrigerant emissions;
– Plans for the installation of ultra-low GWP refrigerants in new refrigeration systems and equipment; and
– Strategies to substantially reduce the company’s HFC footprint in existing equipment during remodeling or replacement of existing refrigeration systems.
In September 2020, Walmart announced that it is transitioning to “low-impact refrigerants” by 2040, but that timeline was found severely wanting by EIA and other stakeholders.
“Today’s shareholder vote shows that a growing number of investors are concerned that Walmart’s 2040 target for phasing down HFC climate super-pollutants is out of step with global and domestic policy,” said Beth Porter, Climate Campaigns Director for Green America. “The resolution received enough support to be re-introduced next year, and in the meantime, investors and consumers will continue pressuring Walmart to cut its HFC emissions on a more rapid timeline.”
“Today’s vote is a pivotal step in investors calling on Walmart to address its largest source of direct climate emissions,” added Christina Starr, Senior Policy Analyst for the Environmental Investigation Agency. “As more and more investors care about meaningful climate action, pressure will mount on supermarkets like Walmart to address refrigerant leaks and stop using super-polluting HFCs quickly.”
Walmart did not respond to a request for comment on the shareholder vote.
Equal to half a million cars
Walmart emits over three million metric tons of HFCs, equating to more than half a million cars on the road each year, said EIA, adding that HFC leaks make up 48% of Walmart’s direct greenhouse gas emissions.
EIA, with a U.S. office in Washington, D.C., issued a refrigerant leak report in February based on its investigation of 45 stores (20 operated by Walmart). The report said that EIA detected leaks at 60% of the stores.
To persuade Walmart shareholders to support the proposal, EIA presented data on the financial impact of its HFC leaks. Assuming that new U.S. regulations cause HFC prices to spike as they have in Europe, refrigerant leaks could cost Walmart $14,000 per store annually, or $280,000 over a refrigeration system’s 20-year lifetime. Across all of Walmart’s U.S. stores, leaks would account for $67 million annually in refrigerant costs.
“Today’s shareholder vote shows that a growing number of investors are concerned that Walmart’s 2040 target for phasing down HFC climate super-pollutants is out of step with global and domestic policy.”
Beth Porter, Green America
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