Bank of Montreal | Client transition plans at the Bank of Montreal

Status
Withdrawn
AGM date
Previous AGM date
Resolution details
Company ticker
BMO:CN
Lead filer
Æquo Shareholder Engagement Services inc.
Resolution ask
Report on or disclose
ESG theme
  • Environment
ESG sub-theme
  • Fossil fuel financing
  • Net Zero / Paris aligned
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
Canada
Resolved clause
RESOLVED: Shareholders request that BMO disclose a report
containing 1) the key elements it uses to assess the credibility of
its client’s transition plans in sectors most exposed to climaterelated risks, 2) the results of an assessment of the credibility of
these client’s transition plans and 3) the procedures for addressing
clients lacking a credible transition plans
Whereas clause
WHEREAS: Whereas
• Climate change is a global crisis that requires urgent action.
Exceeding a 1.5°C warming scenario presents risks to the planet,
economies, investors, and ultimately to the long- term
profitability of banks: projections have found that limiting global
warming to 1.5° degrees will save $20 trillion globally by 2100,
while exceeding 2 degrees could lead to climate damages in the
hundreds of trillions. Estimates show that 10% of global
economic value stands to be lost by 2050 under current
emissions trajectories.
• A growing expectation is that financial sector companies actively
support their client transition to a lower carbon economy.
Glasgow Financial Alliance for Net Zero (GFANZ) encourages
banks to adopt strategies aimed at financing companies
committed to transitioning in line with 1.5 degrees C-aligned
pathways. (Expectations for Real-economy Transition Plans)
• While BMO is planning to start assessing the “maturity of client
level transition plans” and report progress, it has not indicated if
it will disclose the key elements used to assess the credibility of
transition plans, the results of such assessments and the
procedures to address clients with no or inadequate transition
plans.
• Some BMO peers provide some level of clarity on how they
evaluate transition plans. For instance, CIBC has disclosed an
overview of its Carbon Risk Scoring methodology and a weighted
average aggregate score of client transition preparedness.
• For oil and gas (O&G) companies, a credible transition plan
should include aligning their strategies to the International
Energy Agency Net Zero Emissions by 2050 scenario in which
“the rapid drop in O&G demand means that no fossil fuel
exploration is required, and no new O&G fields are required
beyond those that have already been approved for
development.”
• The disclosures requested in this proposal will help investors
further assess the extent to which BMO is adequately managing
climate-related risks and effectively working toward achieving its
interim financed emissions reductions targets and net-zero
ambition

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