Simon Sustainability Report 2014
|Company||Simon Property Group Inc.|
|Filer||New York City Office of the Comptroller|
|Resolved Clause Summary||Sustainability report including responses to ESG issues|
RESOLVED: Shareholders request that the Board of Directors of Simon Property Group, Inc. (“Company”) prepare and make available to shareholders by September, 2014 a sustainability report addressing greenhouse gas emissions, water conservation, waste minimization, energy efficiency, and other environmental and social impacts the Board deems relevant to Company’s business. The report should address sustainability in operations and maintenance as well as design. It should include a review of the Company’s social and environmental policies, practices and goals, as well as multiple objective statistical indicators relating to each of the above environmental and social impacts.
A growing number of investors view companies that are considered good employers, environmental stewards, and corporate citizens as more likely to generate stronger financial returns, better respond to emerging issues, and enjoy long-term success. A 2010 survey by proxy advisor Institutional Shareholder Services found that 83% of investor respondents believed that environmental and social factors can significantly affect long-term shareholder value. A 2011 study by Harvard Business School’s Robert Eccles and two co-authors found that “high sustainability” companies—early voluntary adopters of environmental and social policies—outperformed “low sustainability” companies in terms of both stock market and accounting performance over an 18-year period. (Robert Eccles et al., “The Impact of a Corporate Culture of Sustainability on Corporate Behavior and Performance,” at 28-3, working paper Nov. 2011, available at http://hbswk.hbs.edu/item/6865.html).
The importance assigned to these issues is reflected in the growth of groups such as the Investor Network on Climate Risk (INCR), which supports 100 investors with assets totaling $10 trillion (www.ceres.org/incr), and the UN Principles for Responsible Investment, whose more than 1200 signatories (as of November 2013) have assets under management of approximately $34 trillion (www.unpri.org/about/). Support levels for shareholder proposals addressing sustainability issues continue to climb: average support for proposals on environmental and social issues reached a high of 21.3% in 2013. Support for sustainability proposals average 27.4% for the last 3 years, with a record 67% at CF Industries in 2013 – the highest ever on a social issue (http://siinstitute.org/press/2013/08202013_Si2_Press_Release_Proxy_Review_FINAL.pdf).
Accordingly, it is unsurprising that other major REITs such as Prologis have led in this area through the publication of comprehensive sustainability reports addressing greenhouse gas emissions, environmental stewardship, water use, and other related issues.
We recommend that the Company use the Global Reporting Initiative’s (“GRI’s”) Sustainability Reporting Guidelines to prepare the sustainability report. The GRI is an international organization developed with representatives from the business, environmental, human rights and labor communities; its guidelines provide a flexible reporting system that allows the omission of content that is not relevant to company operations. The GRI provides a supplement to its reporting framework specifically geared toward the construction and real estate sectors.
We urge shareholders to vote for this proposal.