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More Technology Firms Will Face Climate ProposalsSubmitted by: Heidi Welsh, ESG Research Team

As You Sow, a San Francisco-based advocacy group that urges companies to act responsibly toward the environment, has filed the first of several 2009 sustainability reporting proposals at Apple.

The group is expanding its focus from e-waste recycling to ask information technology (IT) companies for sustainability reports that specifically address climate change, targeting companies that did not respond to the Carbon Disclosure Project. As You Sow plans to file resolutions at Broadcom, Jabil Circuit, Microchip Technology, Micron Technology, Novell, and SanDisk. None of these firms, like most companies in the electronics sector, has received similar proposals in the past.

In March, a resolution from investor John Harrington to establish a board-level sustainability committee received 7.8 percent support at Apple. In contrast, five more broadly worded sustainability reporting proposals--which are similar to As You Sow?s new proposal--fared better, averaging just under 30 percent support.

Over the last several years, As You Sow has focused on electronic waste and recycling issues. One of its recent successes is an ?electronics take-back? program run by Best Buy that is in place at the company?s 900 stores nationwide, after an initial run at 130 test stores. A critical component of e-waste recycling is chain-of-custody monitoring for recovered toxics?an issue that could spawn shareholder proposals in the future.

Building on its e-waste recycling in a new effort for 2009 makes sense, says Conrad MacKerron, director of As You Sow?s corporate social responsibility program, because the IT industry contributes significantly to climate change. MacKerron told RiskMetrics that greenhouse gas emissions from IT firms are estimated to make up 2 percent of all carbon emissions globally, ?on par with the aviation industry,? and that electronics firms need to take action. ?We will seek to link the impact of e-waste to climate change,? MacKerron explained, because ?increased recovery of e-waste can reduce the need for the carbon-intensive process to mine and process new metals for electronics.?

For example, he pointed to an Environmental Protection Agency estimate that the gold in 100 million cell phones yields 3.4 metric tons of recovered gold, which avoids the need to mine and process 5.5 million tons of soil and rock. The related energy and fuel use savings could ?dramatically reduce GHG emissions? in the electronics industry supply chain, MacKerron concluded.

As You Sow is continuing its dialogue on emissions reporting and reduction with industry leaders Dell and Hewlett-Packard, MacKerron said, examining how the companies calculate their emissions and obtain data from global supply chains.

Full post as published by Institutional Shareholder Services -- Corporate Governance Blog on December 02, 2008 (boomark / email).