By February 28, 2017 0 Comments Read More →

Buffett’s Berkshire Hathaway rejects fossil fuel proposal, shareholder says

Berkshire Hathaway

Warren Buffett, chairman and CEO of Berkshire Hathaway, says the proposal by the Nebraska Peace Foundation to sell Berkshire’s investments in fossil fuels companies is unnecessary. Reuters file photo by Kevin Lamarque.

Berkshire Hathaway urged to sell investments in Phillips 66, other fossil fuels companies

By Jonathan Stempel

Feb 28 (Reuters) – Warren Buffett’s Berkshire Hathaway Inc will urge shareholders to reject a proposal by a Nebraska nonprofit that it sell its investments in oil refiner Phillips 66 and other companies involved in fossil fuels over 12 years, the nonprofit said on Tuesday.

The Nebraska Peace Foundation, which focuses on anti-war, civil rights and environmental issues, said it received a Feb. 9 letter from Berkshire detailing the Omaha-based conglomerate’s opposition to its proposal, to be voted on at Berkshire’s annual meeting on May 6.

“The Board believes that Berkshire should not limit its universe of potential investments based upon complex social and moral issues,” Berkshire said, according to the nonprofit.

“Berkshire’s businesses and the companies in which it invests have corporate governance structures in place to comply with state and federal laws, including compliance with state and federal environmental regulations and laws which reduce the environmental impact of their operations,” it added.

An assistant to Buffett did not immediately respond to a request for comment.

The Nebraska Peace Foundation called the recommendation “profoundly disappointing.”

It said Buffett should instead use his “international celebrity” to “send a message” about the threat posed by climate change, and the benefits of shifting toward cleaner energy.

The proposal would not cover businesses that Berkshire owns outright, including several utilities and the chemical company Lubrizol.

Buffett owns about 18 per cent of Berkshire’s stock but controls nearly one-third of its voting power, and proposals that lack his support are routinely defeated by wide margins.

At last year’s meeting, a Nebraska Peace Foundation proposal that Berkshire discuss the risks that climate change posed for its insurance businesses won support from only 11 per cent of the votes cast. Buffett called that proposal unnecessary.

Two other shareholder proposals will be introduced at Berkshire’s annual meeting, Buffett said on Saturday.

Buffett is the world’s second-richest person, according to Forbes magazine. The richest, Microsoft Corp co-founder and philanthropist Bill Gates, is also on Berkshire’s board.

Berkshire’s more than 90 businesses include Geico auto insurance, Dairy Queen ice cream and the BNSF railroad.

(Reporting by Jonathan Stempel in New York; Editing by Alan Crosby)

Posted in: Energy Financial

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