The 2023 AGM season has begun and one sector is already in a difficult position: the banks. They have climate NGOs and social activists against them. Until now, they had their shareholders on their side, because the financial sector was the one with record dividends. But now that support is falling. Bank prices have collapsed with the collapse of SVB and the tribulations of Credit Suisse. The world’s top sixty banks have lost an average of 18% of their capitalisation in the last month, while the CAC 40 and the Dow Jones, for example, have lost “only” 4%. They are approaching their annual general meetings in a record of unpopularity. Once again, climate activists are playing the pilot fish for all the other malcontents. In France, the AMF is calling for calm and dialogue.
Danske Bank came under first attack on 17 March. Its meeting is, as it is every year, a laboratory for the other banks. The leading Danish financial institution has the Maersk family, originally shipowners, as shareholders, but also other European banks, Amundi, Norges Bank and Deutsche Bank, not to mention the American investors Blackrock and Vanguard. Around the table, the European financial world is having a final rehearsal before the big meeting season. Danske Bank faced this year, as in 2022, the Climate Resolutions of Action Aid. The South African NGO is systematically asking the world’s top 60 banks to stop financing fossil fuels. A graph has been circulated showing a total of $4.5 trillion in coal, oil and shale gas financing by these banks since 2016, with the majority going to oil exploration. The equivalent of one year’s GDP of Germany. Danske Bank is financing a very small share: $6.7 billion. Thanks to the support of the other banks present in the capital, the three Action Aid resolutions did not pass the majority vote. But Danske Bank could not avoid the bad publicity given to its climate strategy, even though it was presented in detail. Nor could the Danish bank avoid media contagion between this protest and the money laundering scandals over which it agreed last December to settle for $2 billion in US court cases. The protesters did not win the battle of votes, but they did win the battle of image. And reputation carries a lot of weight when the end customer has to choose his bank, and activist NGOs know this well.
Action Aid will not stop there. There are still 59 banks on its list, in Europe, the UK and the US. Next up is the Wells Fargo meeting in the US on 25 April. According to Action Aid, the bank has financed fossil fuels to the tune of $272 billion in five years. Wells Fargo is also facing shareholder discontent over its unclear social management, with the dismissal of hundreds of people in February, some of whom were presented a week earlier as “high potential”. A month after Apple negotiated labour peace, Wells Fargo will have to choose between dealing quickly with its unions or seeing this social issue explode in a meeting. Action Aid, which is active on climate change, is ready to broaden its action by supporting union demands. So are large international investors like Blackrock.
In France, the first deadline for Action Aid is the BNP Paribas meeting on 16 May. The NGO is already threatening to submit its protest resolutions. It points out that the bank has already been put on notice by three other NGOs – the Brazilian NGO Comissão Pastoral da Terra (CPT), the French association Notre Affaire À Tous (NAAT), and the North American NGO Rainforest Action Network, which are asking BNP Paribas to stop financing Marfrig, which is responsible for illegal deforestation in the Amazon.
Faced with this uproar, France has an advantage. The regulator is calling for appeasement and dialogue. In an official communication, the AMF recommended on 8 March that all listed companies “further strengthen their communication on their climate strategy and present it at each general meeting in the form of an agenda item with debate”. This is a legal possibility specific to France, which shareholders and companies rarely use, preferring to limit the meeting to items that are subject to a vote.
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