DETROIT -- Eighteen large institutional investors in General Motors banded together Friday to tell GM they want the carmaker to take aggressive action to protect federal fuel economy standards.
GM has said it wants one national fuel economy standard modeled on the existing zero emissions vehicle program in California. It would establish zero emissions requirements (by credits) each year, starting at 7% in 2021 and increasing 2% each year to 15% by 2025, then 25% by 2030.
But in a letter sent to GM CEO Mary Barra ahead of GM's June 4 annual shareholders meeting, the investors said GM's position calling for one national standard will weaken the current standards and undermine California's authority to set strict standards.
"By claiming a commitment to climate action publicly while lobbying against strong federal standards, GM exposes itself, and investors, to significant reputational and legal risks, regulatory uncertainty and delay, and systemic economic risks," said Rob Fohr, director of Faith-Based Investing and Corporate Engagement for the Presbyterian Church U.S.A., an investor named in the letter. Fohr said GM stock is currently held by the Foundation of the Presbyterian Church U.S.A.
A spokesman for GM said the company is reviewing the letter and will be responding directly to the shareholders.
Shareholders said that GM's proposal for a national ZEV program would "effectively preempt California and states that have adopted" California's program. The result would be little progress in the reduction of emissions despite the deployment of more electric cars.
GM has said it wants a future of "zero crashes, zero emissions and zero congestion" and supports electric vehicle deployment as part of that as well as a national emissions standard that reduces emissions, but still allows flexibility to meet consumer demands.
"We believe in a policy approach that better promotes U.S. innovation and starts a much-needed national discussion on electric vehicle development and deployment in this country," Mark Reuss, GM's executive vice president and president of Global Product Group and Cadillac, has said in the past. "A national zero emissions program will drive the scale and infrastructure investments needed to allow the U.S. to lead the way to a zero emissions future."
Collectively the group of shareholders in the letter manage $1.96 trillion. The group is "concerned that the company, either through its industry association or through its own lobbying, is actively working against maintaining the existing clean vehicle standards," said Jamie Bonham, manager, of corporate engagement at NEI Investments, which owns 167,689 shares in GM. "Our concerns are driven primarily by the risks we feel this strategy is exposing the company to, such as, reputation, legal, regulatory uncertainty and delay."