Toyota shareholders reject proposal demanding better performance on climate change

By Associated Press

TOYOTA, Japan (AP) — Toyota executives fielded challenges and reaped praise from investors at an annual general meeting Wednesday where shareholders ultimately rejected demands the automaker do better on fighting climate change.

The investor proposal was initiated by AkademikerPension, a $20 billion Danish investment fund. It accused Toyota Motor Corp. of lobbying to weaken efforts by governments around the world to phase out the internal combustion engine.

Shareholders applauded in rejecting the proposal, as expected, at the meeting in Toyota city, central Japan. Some 3,800 shareholders packed a hall at Toyota headquarters. The exact number of the ballots cast will not be disclosed until Thursday, but were taken into account in the vote.

The majority of Toyota shares are held by the company and its group companies, retired employees and others sympathetic to the company’s perspective.

The shareholders’ proposal also challenged the reappointment of Toyota’s chairman, Akio Toyoda, grandson of the company founder and a board director, arguing the company has lagged in keeping up with the global shift to battery electric vehicles.

Toyoda and other company officials defended their green record, noting Toyota is aiming for carbon neutrality, or net-zero carbon emissions, in its lineup by 2050.

The resolution filed by the Danish fund was also supported by Norwegian financial services company Storebrand Asset Management and a Dutch pension investment company, APG Asset Management.

“From an investment perspective, we’re concerned that Toyota is missing out on profits from soaring EV sales, jeopardizing its valuable brand and cementing its global laggard status,” Anders Schelde, CIO at the Danish fund, said in a statement ahead of the meeting.

Others behind the proposal said Toyota needs to live up to its commitment to the Paris Agreement, an international treaty to reduce greenhouse emissions.

“Toyota plays a pivotal role in the Japanese automotive related industry, which leads the country’s manufacturing and economy,” said Herman Slooijer, CIO a APG Asset Management.

Toyota officials stressed that instead of just focusing on battery electric vehicles the company was pursuing multiple energy options, including hybrids, plug-ins and hydrogen-powered vehicles.

“Various options need to be readied,” said Masahiro Yamamoto, one of the executives. “What is important is to better convey our efforts to all shareholders.”

The company’s president, Koji Sato has acknowledged Toyota has fallen behind in battery EVs and must play catchup. He tried to assure shareholders the company is working hard to “move people’s hearts,” based on a team-oriented style of management.

Toyota’s latest environmental initiatives include the development of the all-solid-state battery for EVs by as early as 2027.

Major U.S. pensions, including the New York City Comptroller’s Office and the California Public Employees’ Retirement System, backed the climate change proposal.

“The growing battery electric vehicle market represents an opportunity for Toyota to regain its status as an innovator and leader during the historic transition of the transportation industry,” NY City Comptroller Brad Lander said.