Chubb, Berkshire Hathaway, Travelers & Hartford top activist targets

Chubb,  Berkshire Hathaway,  Travelers and  The Hartford are back atop the list of insurers in the sights of activist investors for the 2023 GM season, with a high portion of repeats from 2022 initiatives, a review of 2023 corporate proxy materials and activist declarations indicate.

Warren Buffett's Berkshire Hathaway will face a fairly familiar set of three climate-related shareholder demands when its shareholder soiree comes together, chiefly to report on its related financing/ underwriting and craft a climate-related transition plan. Prior year motions failed on the weight of Buffett's stake, although activists ballyhooed a near-majority amongst non-insider votes.

America's largest state pension fund, The California Public Employees Retirement System (CalPERS) will again be part of the fray, this time in concert with Caisse de Dépôt et Placement du Québec (CDPQ), sponsoring one of the climate motions.

Berkshire Hathaway will likewise face a repeat attempt by the National Legal and Policy Center to force the firm to separate the role of chairman and CEO, both now held by Buffett. A similar motion failed one year prior.

Chubb and Travelers may face some activist ire in 2023. That said, Chubb stressed that it did publish a climate report to address shareholder votes and also respond to related queries in its TCFD report issued in late 2022. The report reflected Chubb’s strategies and actions over the previous year with respect to climate risk management and climate strategy. It also stressed it is responsive to its shareholders’ request for information regarding our climate-related activities.

Motions set to hit the table at Chubb include two on climate-related transition plans, a review of early proxy materials shows. Travelers will be likewise asked to report on GHG emission financing, then pushed to limit underwriting and financing of fossil fuels.

Travelers and Chubb have once again appealed to the US Securities and Exchange Commission (SEC) for permission to exclude the votes, after having failed in similar bids in 2022, the report from the activist coalition suggests. The SEC has been considerably less supportive of such requests since 2023 and a number have begun to drop the pursuit, the group claims.

The activist shareholder 2022 track record, including the victories on climate reporting at Chubb and Travelers but outright failures to force net zero targeting, have worked to shift activist efforts for the 2023 season.

“Last year’s focus on how banks and insurers finance and underwrite fossil fuel projects continues with 22 proposals, although requests to cut off funds earned much lower support in 2022 and the resolutions now ask for ‘time-bound phaseouts’ that provide more wiggle room,” a consortium of activist investor groups said in a report on the 2023 season.

The Hartford complied with shareholder demands from 2022 on reporting, but did not fully escape activist sights for the new year. An ESG-focused asset manager will push for limits on underwriting and financing fossil fuels.

Travelers’ shareholders will be much busier still, with a total of five shareholders resolutions on the table. Beyond the two climate-oriented resolutions, the firm faces a demand for a racial justice audit, a demand for greater disclosures on lobbying and a repeat demand that the company review its police liability offer and mull changes.

Elsewhere on the 2023 shareholder agenda: Berkshire Hathaway faces a request for a DEI report. Chubb and The Hartford will face pressure to prepare a human rights impact assessment and shareholders at PNC will seek reporting on "financing of controversial weapon sales" as well as a motion on limits on support for fossil fuels.

Amongst major US insurers, AIG, Markel, and Everest Re are among firms which have yet to publish proxy materials.

Arch Capital, Axis Capital, Fairfax Financial Holdings and The Hanover seem to be clear of shareholder initiatives for their 2023 soirees as of the most recent proxy filings.

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