Activist investors seek to block appointment of Deloitte climate failure audit
A group of investors including Aviva and Legal & General are preparing to take on accountancy giant Deloitte this week in a bid to prevent its reappointment as auditor of FTSE building supplies company CRH 100.
Climate Action 100+, an activist shareholder group of 700 investors with a total of $68 billion in assets under management, will vote against reappointment at CRH’s annual general meeting this Thursday, said first reported the Sunday Times.
The group says the accounts of Dublin-based CRH are unable to determine how its finances would be affected by changes to climate policy, including the introduction of carbon taxes and a stricter requirement for companies to reduce their emissions.
Cement and building materials maker CRH, led by boss Alber Manifold, has a “pathway to net zero strategy” which it says is aligned with the requirements set out in the 2015 Paris Agreement.
But Climate Action says the plan fails to take into account the “material risks” of climate change.
The group warned that this omission could lead to a “misallocation of capital in carbon-intensive activities, thus potentially destroying shareholder value”.
The group is now set to vote against the reappointment of Deloitte Ireland and audit committee chair Shaun Kelly, a former KPMG partner, as well as vote against the company’s annual accounts, reports the Sunday Times. .
The vice chair of the Climate Action 100+ steering committee said the vote “could be a turning point in the campaign to hold audit committee chairs and auditors to account.”
Audit watchdog the Financial Reporting Council has warned that climate change risk is a top priority for auditors next year.
Climate Action’s campaign against Deloitte comes just a week after the big four firms were fined £2million for failures in the audit of facilities management company Mitie.