BERKSHIRE HATHAWAY INC. | Board competency and climate governance at BERKSHIRE HATHAWAY INC.

Status
17.96% votes in favour
AGM date
Previous AGM date
Proposal number
5
Resolution details
Company ticker
BRK/A US
Lead filer
Office of the Illinois State Treasurer
Resolution ask
Report on or disclose
ESG theme
  • Environment
  • Governance
ESG sub-theme
  • Other
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
United States
Resolved clause
Resolved: Shareholders of Berkshire Hathaway Inc. (the “Company”) request that its Board of Directors (the “Board”) disclose in their annual proxy statement how climate-related risks are being governed by the company, including, but not limited to, the audit committee’s oversight of climate risks and disclosures. The disclosure should also including:
1. If and how the company is testing the impacts of climate-related risks on the business, including how assumptions from low-carbon scenarios would affect assumptions, costs, estimates, and valuations underlying its financial statements;
2.The degree to which the company deems directors to be competent in climate-related risks and any internal or external training that the board received on climate and ESG matters; and
3. If and how climate and ESG attributes are considered in director elections and succession planning.

The disclosures should be made at reasonable cost to the company and omitting any proprietary information.
Supporting statement
Supporting Statement: Over the past year Berkshire Hathaway has made steps to clarify to investors how climate-related risks and opportunities are managed by the board by designating responsibility of these matters to the audit committee. As the risks related to climate change and the energy transition proliferate, this oversight is critical to ensure that these risks are being appropriately overseen and managed. Therefore, it is important that the company discloses how the changes to the audit committee charter have been implemented.
Climate-related impacts are already having a material impact on the company, including, but not limited, to the impact of hurricanes and floods on the earnings of the insurance business. To ensure that these financial impacts are contained in the future, it is essential for the board to be aware of how these impacts will arise and how they might impact the future financial performance of the company. Both physical and transitional climate-related risks are complex to understand and require a deep understanding of the implications of various climate scenarios. Investors expect all board members to be educated on climate-related matters.
Climate Action 100+, an investor-led initiative to ensure the world’s largest corporate greenhouse gas (“GHG”) emitters take necessary action on climate change, conducts an assessment of top carbon emitting companies against ten indicators, evaluating company performance on its transition to a net zero emissions future. The assessment reviews corporate disclosures on GHG emissions, capital allocation alignment, and climate governance among other factors. Berkshire Hathaway fails to meet the criteria on any of the ten indicators.1
As governments around the world have committed to reduce emissions to net zero and mitigate warming to well below 2°C with the ambition of achieving 1.5°C, it is particularly important that the board is able to demonstrate its understanding of how the company will perform under such conditions and that these risks are accounted for.
We urge shareholders to vote for this proposal.

How other organisations have declared their voting intentions

Organisation nameDeclared voting intentionsRationale
Anima SgrForThe enhanced disclosure would allow shareholders to assess the board’s governance and risk oversight mechanisms in place to protect the company from potentially adverse regulatory requirements and market changes related to the energy transition.
VidaCaixaFor
Rothschild & co Asset ManagementFor

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