Emission plan on trucker’s agenda
J.B. Hunt Transport Services Inc. will consider a shareholder’s proposal regarding greenhouse gas emissions during its annual meeting despite the company’s efforts to keep it from going to a vote.
The proposal, which will be considered during the shareholders meeting on April 23, was submitted by Lancelot King of Calvert Investments last November. The Maryland-based activist investment firm asked J.B. Hunt to “adopt quantitative company-wide goals for reducing GHG emissions from operations and products and report on its plan to achieve these goals by Sept. 2015.”
Calvert Investments highlighted a 2014 report by the Intergovernmental Panel on Climate Change, which concluded “humancaused warming of the climate system is unequivocal.” The firm also included in its proposal analysis that found companies in the United States could reduce emissions 3 percent annually and save up to $780 billion between now and 2020.
“We recommend J.B.
Hunt take into consideration the IPCC analysis and identified emission reduction targets as it sets its own scientific-based goal,” King wrote. “We also recommend that the company consider renewable energy procurement as a strategy to achieve its emission reduction goals.”
J.B. Hunt submitted a letter to the U.S. Security and Exchange Commission a month later, notifying it of plans to omit the proposal from its annual proxy statement. The company told the SEC it believed the proposal should be excluded because it dealt with matters relating to the conduct of the company’s ordinary business operations and further sought to micromanage the daily operations and decisions. It also indicated the claims contained “impermissible misleading and vague language.”
The SEC didn’t agree in a response from attorney-advisor Sonia Bednarowskion Jan. 12.
The greenhouse gas proposal was included on J.B. Hunt’s proxy, which was filed Friday. J.B. Hunt offered no additional comment other than what was in the proxy statement.
It will be considered along with other items such as the re-election of members of the board of directors, and the appointment of Ernest and Young LLP as its accounting firm for 2015.
J.B. Hunt’s board of directors acknowledged the reduction of greenhouse gas emissions is of “significant importance” in the proxy statement, but recommended shareholders vote against the proposal because it would duplicate the company’s existing efforts.
“Environmental considerations like those identified … are built into the company’s core modeling as it relates to our mission to provide customized freight movement, revenue equipment, labor and systems services tailored to meet the customer’s specific requirements,” the board said, according to a statement in the proxy. “The company has stood at the forefront of environmentally friendly transportation services and has undertaken a variety of green initiatives throughout the business.”
J.B. Hunt listed eight examples of its efforts in the proxy, beginning with an intermodal sector that accounted for roughly 60 percent of J.B. Hunt’s total revenue in 2014. The company said moving 1.7 intermodal loads prevented nearly 2.4 million tons of carbon dioxide equivalent from the atmosphere.
J.B. Hunt also pointed toward its regular participation in industry groups focused on GHG emissions and a strong record of its equipment complying with required emissions standards among its initiatives. But duplication of its existing efforts wasn’t J.B. Hunt’s only concern.
The board doesn’t believe it is “prudent to make specific commitments or to be informally regulated by individual stockholders on specific issues.” Instead, the board said the interest of stockholders are better served without a proposal requiring the disclosure of “strategic goals and plans.”
“We believe the above proposal could undermine the company’s ability to compete in the transportation marketplace, reducing our profitability and harming the financial interests of our stockholders,” the board said, according to a statement in the proxy. “The proposal’s requests would in essence commit the company to publicly disclosing our strategies and solutions for reducing GHG emissions.”