European investors have urged Toyota Motor Corp. to improve disclosure of its lobbying on climate change ahead of an annual shareholder meeting in June.
A resolution was submitted by three funds that together hold $400 million in Toyota shares — Danish pension fund AkademikerPension, Norwegian financial services company Storebrand Asset Management AS and Dutch group APG Asset Management NV — on Wednesday before Toyota announced earnings in Tokyo.
Toyota’s board opposed it, citing past and ongoing efforts to make such disclosures since 2021 and reduce harmful emissions as part of its goal to expand electric vehicle production and become carbon neutral by 2050.
The Japanese automaker’s Chief Executive Officer Koji Sato has promised that by 2026, Toyota will sell 1.5 million battery EVs every year. The carmaker’s multi-pronged approach, which involves selling electric cars alongside those powered by hybrid or internal combustion engines, has long drawn criticism from environmental advocacy groups.
The funds’ proposal called on Toyota to conduct and publish an annual review of its climate-related lobbying activities and determine how they reduce its climate risks and reflect the goals put forward by the Paris Agreement. The proposal also said the company’s second and most recent report on climate lobbying falls short of industry standards.
Such disclosures could serve to mitigate reputational and other risks, the proposal reads, including potential backlash from customers, business partners, employees and investors.
“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, chief investment officer at AkademikerPension, said in a statement. “We need concrete policy changes and a better annual review drawing on independent data to calm international investors.”
