Environmental groups ask P&G investors to vote against CEO as board chair

The Procter & Gamble Co. logo is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York, the United States, June 27, 2018. REUTERS/Brendan McDermid

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NEW YORK, Sept 19 (Reuters) – Environmental groups are urging Procter & Gamble Co (PG.N) investors to vote against the re-election of Procter & Gamble Co (PG.N) chief executive officer and to speak at next’s annual meeting Monthly against two other directors on a filing alleging the company uses too much virgin wood pulp in its paper products.

Environmental groups like the Natural Resources Defense Council (NRDC) have targeted the maker of Bounty paper towels and Charmin toilet paper in recent years, urging the consumer goods company to clean up its palm oil extraction from tropical rainforests. Continue reading

NRDC, Friends of the Earth and the Rainforest Action Network now want investors to vote against CEO Jon Moeller as chairman of the board, according to the US Securities and Exchange Commission. They also oppose company CEOs Angela Braly, chair of the Governance and Public Responsibility Committee, and Patricia Woertz, a member of that committee.

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Investors will vote to re-elect P&G’s corporate directors at the October 11 annual meeting. In the filing, the environmental groups are calling for Moeller to be replaced with an independent chairman, a structure some investors favor.

“P&G’s actions have been insufficient to curb deforestation,” the filing said, adding that the company’s “management team lacks the skills, perspective and experience” to manage the environmental risks it faces.

P&G did not respond to a request for comment. Environmentalists have been urging P&G to make changes to forest management for several years.

“These proposals are more impactful because they get more support,” said Nell Minow, vice chair of corporate governance consultancy ValueEdge Advisors, adding that recent regulatory changes are making it easier for activist investors to appoint their own directors.

“There is a significant next step, and that will fuel these conversations,” Minow said.

The Cincinnati-based company announced in an update in July that it has developed and is testing two new Charmin products, one made from plant-based fibers and one made from bamboo, efforts backed by environmentalists.

The consumer goods group has also pledged to only purchase pulp that meets certain criteria by 2030.

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A majority of investors backed a resolution by Green Century Capital Management Inc two years ago calling for P&G to issue a report on how it could increase its efforts to eliminate deforestation and degradation in its supply chain.

“Two years later, they’ve basically done nothing,” said Jennifer Skene, policy manager at NRDC.

Last year, NRDC also urged investors to vote against Braly, and she received significantly fewer votes than other directors for her re-nomination to the board, according to a securities filing.

NRDC is supported by two shareholders who are descendants of P&G’s founders, Christopher Matthews of New York and Justine Epstein of the San Francisco Bay Area, California. Matthews and Epstein told Reuters they had asked Moeller to meet, but as of Monday they had not received a response.

P&G is “laser focused on shareholder values ​​and the value of the company from an asset perspective,” Matthews said.

“The investment community sees that it’s lagging behind on sustainability,” Matthews said.

Braly’s role as chair of the Governance and Public Responsibility Committee, which oversees environmental concerns including forestry, “has failed to mitigate risks in P&G’s forest sourcing,” the environmental groups said.

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Woertz’s role on the same committee is “questionable,” the groups said, because she worked at oil and gas explorer Chevron Corp (CVX.N) for nearly 30 years, the nonprofits said.

Braly did not immediately respond to a request for comment. Woertz could not be reached immediately.

The environmental groups said Moeller’s work with Monsanto, which is owned by Bayer, “is not consistent with the prioritization of corporate responsibility or scientific integrity.” Bayer agreed to pay billions of dollars in 2020 to settle lawsuits brought by people claiming they were harmed by its weed killer Roundup and is defending thousands of lawsuits filed by Roundup users. Continue reading

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reporting by Jessica DiNapoli in New York City; Adaptation by Jonathan Oatis and David Gregorio

Our standards: The Thomson Reuters Trust Principles.

Jessica Dinapoli

Thomson Reuters

A New York-based reporter covering US consumer products ranging from paper towels to packaged foods, the companies that make them and how they are responding to the economy. Previously, he reported on corporate boards and distressed companies.

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