This article is the first in a two-part look at environmental and social issue proposals filed by shareholders for the 2007 proxy season. This preview focuses on environmental issues, while next week's article will address political contributions and other social issues.

Shareholders concerned with how U.S. companies manage environmental and social issues have already filed more than 340 proposals this season. The number of resolutions point to a busy proxy year that could beat the all-time high of 367 resolutions offered in 2006.

As a barometer of the times, one out of every 10 of these proposals deals with how companies should best respond to challenges posed by global warming. Climate change-related proposals, along with proposals on reducing the use of toxic chemicals or seeking action on other environmental issues, account for more than 70 of the proposals filed for this year’s meetings. In addition, 39 proposals have been filed so far asking companies to issue sustainability reports, nearly double the 20 submitted last year.

Climate change continues to be a major concern of proponents of environmental resolutions, as evidenced by the submission of 45 proposals focused directly on greenhouse emissions or indirectly on renewable energy.

Proponents have submitted a new proposal to Chevron, ExxonMobil, Ford Motor, General Motors, and TXU asking the companies to adopt quantitative goals for reducing their greenhouse gas emissions. Other shareholders have filed four more climate change proposals at ExxonMobil, all of which are awaiting decisions on the company's no-action challenges at the U.S. Securities and Exchange Commission (SEC). ExxonMobil acknowledges the need to improve energy efficiency and decrease emissions but argues the pursuit of specific projects--such as establishing quantitative goals--is not something that shareholders should decide at the annual meeting.

New York City's pension funds withdrew the quantitative goals proposal at TXU. Still, two other greenhouse emission proposals are pending at the company, according to the proponents, but none may come to votes if a proposed $44 billion buyout goes through. Two private buyout firms seeking to acquire TXU have told environmental groups that they would scale back the utility company's plans to build 11 new coal-fired plants to three such plants.

Calvert Asset Management filed resolutions at Bemis, Hartford Financial, Prudential, and Teradyne asking for company reports on the effects of climate change on their operations. The investment firm reports that it withdrew all four proposals after reaching agreements with the companies. The American Federation of State, County, and Municipal Employees said it withdrew a similar resolution at another insurance company, Chubb, in return for a promise of future discussions before the SEC agreed to the company’s no-action request. Insurance companies have always been able to get SEC permission to omit greenhouse-emissions-related shareholder resolutions by arguing that assessing greenhouse risks is an ordinary business issue for that industry.

In addition, the Service Employees International Union has filed a new resolution with Wells Fargo asking for emissions reduction goals for the company's own operations and the activities of its corporate borrowers, advisory, and project finance clients. A new church-sponsored resolution at Starwood Hotel & Resorts Worldwide asks for a report on the feasibility of developing policies that will minimize the company's impacts on climate change.

On the related issue of renewables, Trillium Asset Management reports it has filed a proposal at ConocoPhillips that seeks a report on how the company will respond to rising pressure to develop renewable energy sources. The Nathan Cummings Foundation is continuing to file this proposal with property development companies and retailers. The foundation re-filed at Standard Pacific, where the resolution got 39.3 percent support in 2006, a record for proposals related to climate change.

This year, Standard challenged the resolution successfully at the SEC, pointing to a June 2005 staff bulletin that sanctioned the omission of environmental and health resolutions if they would entail an evaluation of business risk (the supporting statement asserted that ignoring the issue of renewables could expose the company as an industry laggard and open it to competitive and industry risk). Pulte Homes was allowed to omit the proposal for the same reason.

Nevertheless, renewable energy proposals are being looked at by other companies. The issue has already been voted on at Whole Foods for a second year, and a mix of proponents have filed it for the first time at Boston Properties and CVS. The resolution has been withdrawn after agreements at D.R. Horton and Toll Brothers, proponents say.

A handful of the resolutions filed this year on climate issues come from individuals and organizations that question the scientific consensus on climate change. Carl Olson has re-filed resolutions with Ford and Occidental Petroleum asking for a detailed scientific report on how the companies measure "global warming/cooling." The SEC staff had allowed companies to omit the resolution in 2004 and 2005, but did an about-face, without explanation, last year.

Climate change skeptic Action Fund Management is re-filing a resolution to General Electric asking for a report on, among other things, whether climate-related change is necessarily undesirable and whether a cost-effective strategy for mitigating any undesirable change is practical. That proposal survived a challenge at the SEC, but a second Action Fund proposal was omitted at Hewlett-Packard. The resolved clause was similar, but the supporting statement raised the question of business risk by asserting that the company risked being sued in California for reporting its greenhouse emissions to the Carbon Disclosure Project.