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Amazon Facing Shareholder Dissent for Being a ‘Climate Risk’

Two of Amazon’s shareholders have filed a resolution urging the retail titan to measure and disclose the total amount of greenhouse-gas emissions generated by its entire value chain, including those from the merchandise it sells from third-party vendors.

Amalgamated Bank, America’s largest union-owned bank, and Green Century Capital Management, an investment firm that invests in environmentalist causes, will be taking the resolution to Amazon’s annual meeting in May, when voting on different measures will take place.

“Amazon has failed to take responsibility for the vast majority of greenhouse gas emissions it enables as the world’s largest online retailer,” said Daniel Stewart, energy and climate program manager at As You Sow, a shareholder advocacy nonprofit that is representing Amalgamated Bank. “As climate impacts accelerate, it is critical that Amazon work to ensure that the products it sells and the suppliers it works with are transitioning to net zero.”

While the Everything Store has committed to hitting net zero by 2040, the resolution said, it fails to divulge emissions for the products it sells beyond those under its own imprimatur, which make up only 1 percent of sales. By leaving out the vast majority of the items it sells, Amazon is reflecting “only a portion” of its full climate impact, it added. This stands in contrast with rivals Target and Walmart, which each reveal emissions from all product sales and have adopted Science Based Targets initiative-verified goals for reducing their environmental burden.

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“Amazon is trying to claim a leadership spot in the corporate race to net-zero emissions but is not disclosing all of its greenhouse gas emissions, leaving investors to wonder whether Amazon is a climate risk rather than a climate leader,” said Andrea Ranger, shareholder advocate at Green Century Capital Management.

The resolution also recommends that Amazon adopt emissions reduction targets for all Greenhouse Gas Protocol-defined sources of Scope 3 emissions, including those generated from products sold by third-party sellers, in alignment with Paris Agreement goals. The Whole Foods owner, it said, could also require its largest vendors by revenue to set science-based targets.

Even with its current disclosures, it noted, Amazon’s absolute emissions have ballooned roughly 40 percent since 2019 when they need to be falling to help limit global warming to 1.5 degrees Celsius above pre-industrial levels.

“Amazon’s challenges in delivering on its climate commitments reflect the uphill task our economy faces in decarbonizing, but investors expect more from a company of this size and capacity,” said Ivan Frishberg, Amalgamated Bank’s chief sustainability officer.

Amazon told Sourcing Journal that it has no comment on the proposal itself, and that any response will become available as part of standard shareholder processes governed by the U.S. Securities and Exchange Commission (SEC).

The SEC has, for its part, proposed mandating enhanced climate-related disclosures by most public businesses, Scope 3 included. The scheme has powerful opponents, however. Already, House and Senate Republications have floated bills blocking its complete adoption.

As You Sow has spearheaded Amazon resolutions before. This past June, the organization rallied 48 percent of the Jeff Bezos-founded firm’s shareholders—just slightly short of a majority—to vote in favor of a proposal to address its growing plastic packaging problem. The resolution, As You Sow said, received the most support of any of the multiple resolutions considered at the meeting, with 181,296,823 ayes.

“Nearly half of Amazon shareholders have spoken up for the oceans, sending a clear message that it’s time for the company to address its contribution to the plastic pollution problem,” Matt Littlejohn, senior vice president of environmental nonprofit Oceana, said at the time. “Sea turtles and other ocean animals often mistake plastic for food, which can ultimately prove fatal. Amazon is a data-driven company and has indicated to Oceana that it already measures its plastic use. It’s time for the company to be transparent about its plastic packaging and commit to quantifiable and time-bound company-wide goals to reduce it.”

In 2021, the commercial juggernaut generated 709 million pounds of plastic packaging, an 18 percent jump from the year before, Oceana said earlier this month. Translated into air pillows, this is enough plastic to circle the planet more than 800 times, it said.

Oceana’s numbers clashed with those provided by Amazon, which said it reduced the average plastic packaging weight per shipment by more than 7 percent over the past year, resulting in 97,222 metric tons—roughly 214 million pounds—of plastic mailers, cling film and bubble wrap across its global operations.

“We know customers care about the packaging used to ship their Amazon orders. Customers want orders delivered in right-sized, easily recyclable packaging that makes sure the product arrives in great condition and minimizes its impact on the environment,” Amazon wrote in a blog post. “At Amazon, we care deeply about our packaging achieving both of these goals, and we have teams of scientists and other experts who are constantly working to reinvent how products are shipped for the good of customers and the planet.”

But like its emissions, Amazon is undercalculating its plastic footprint, Littlejohn said, noting that the Prime purveyor only accounted for plastic packaging used for orders dispatched through owned and operated fulfillment centers in the countries where it has hung a shingle. Oceana, on the other hand, included all sales through Amazon’s e-commerce platforms worldwide, including those fulfilled by third-party sellers.

“It is unclear how much of Amazon’s total sales are sent through the company’s fulfillment centers; Amazon has declined to disclose this information to Oceana,” Littlejohn said. “If Amazon really is ‘a company that obsesses about [their] customers,’ they would eliminate plastic packaging, increase the number of products shipped in reusable containers, and adopt policies that demonstrably reduce their global plastic pollution footprint.”