CORPORATE WELFARE BUM
RBC CEO defends pipeline funding, calls for net-zero incentives
By Nichola Saminather
(Reuters) -Royal Bank of Canada's (RBC) chief executive on Thursday defended the bank's funding of the Coastal GasLink pipeline and called for incentives to help the shift to a net-zero economy, as investors and indigenous groups denounced its support of fossil fuels.
Chief Executive Dave McKay was speaking at the bank's annual shareholder meeting, which had been changed to a virtual-only format late on Wednesday after confirmation of a positive case of COVID-19 among its staff.
Chiefs of the Wet'suwet'en indigenous people had traveled from British Columbia to Toronto to express their opposition in person to RBC's financing of the pipeline's construction on traditional indigenous land. The pipeline is 65% owned by private equity firm KKR & Co Inc and the Alberta Investment Management Corp.
The Royal Bank of Canada logo is seen outside of a branch in Ottawa
Calling into the meeting, they accused the bank of funding a project that they said has damaged rivers and wetland forests and limited their ability to hunt wild life.
McKay said the project has been extensively reviewed and approved by regulators and has the support of all 20 nations along the route, including some Wet'suwet'en elected leaders. He added that 16 of them have taken the option to have an economic interest in it.
RBC shares fell 1.2% to C$135.48 at midday on Thursday, compared with the Toronto stock benchmark's 0.7% decline.
Canada's major banks including RBC, the biggest, have released plans to lower their financed emissions, but continued funding of fossil fuel companies and pipelines has riled some investors and communities.
Last week, Canada released a C$9.1 billion ($7.24 billion) plan to meet its 2030 emissions-reduction targets.
Spending on green technologies is set to be a focal point of the 2020 budget, to be released later on Thursday.
The Canadian government's plan to reduce carbon emissions will lead to "a massive shift in this decade," which will require "public and private capital to support both growth and the green transition," McKay said.
"That's why investment and tax policies, as well as incentives must be considered."
McKay also reiterated his concern about a proposed tax on banks' profits.
Two shareholder proposals urging RBC to exclude fossil fuel activity and projects opposed by indigenous groups from eligibility for sustainable financing, and refrain from funding and advising on the privatization of pollution-intensive assets were defeated, in line with the board's recommendation.
(Reporting by Nichola Saminather in Toronto; Additional reporting by Mehnaz Yasmin in Bengaluru; Editing by Shailesh Kuber and Barbara Lewis)
RBC CEO says 'orderly transition' to net-zero crucial amid criticism of climate plan
Yesterday
Yesterday
The Canadian Press
TORONTO — Royal Bank of Canada's chief executive officer said Thursday that an "orderly transition" to a net-zero economy is crucial, as he faced questions about the bank's climate strategy and ongoing financing of fossil fuels during its annual shareholder meeting.
"We can't be unsuccessful in this journey," CEO Dave McKay said.
The bank, which is the largest lender to fossil fuels in Canada, was criticized for not moving fast enough on its net-zero activities.
McKay was also pressed on issues like the effects of oilsands extraction and the Coastal GasLink pipeline project.
RBC acts as a financial adviser to the pipeline project and also provides working capital. Wet’suwet’en hereditary chiefs, who don't support the pipeline, made their way to Toronto to ask questions about the bank's funding of it, but left unsatisfied.
Despite the pushback, McKay said the majority of Indigenous communities do support the pipeline. There are 20 Indigenous groups along the route that approve of the pipeline.
RBC: There's been quite a dispersion across the energy sector and stocks in terms of positive and negative impacts
"(The pipeline) presents very significant growth and economic opportunity for the communities that (it) passes through," he said.
Meanwhile, in his prepared remarks, McKay emphasized RBC's commitment to reducing global emissions in its operations by 70 per cent by 2025.
McKay said the bank is working closely with its clients on their net-zero strategies and intends on publishing emission reduction goals for its oil and gas, utilities and automotive portfolios this fall.
He added that a better approach to public-private collaboration is needed to address the transition to a net-zero economy.
Climate protests took place outside the meeting, which was changed to a virtual-only event late Wednesday.
This report by The Canadian Press was first published April 7, 2022.
Companies in this story: (TSX:RY)
Adena Ali, The Canadian Press
TORONTO — Royal Bank of Canada's chief executive officer said Thursday that an "orderly transition" to a net-zero economy is crucial, as he faced questions about the bank's climate strategy and ongoing financing of fossil fuels during its annual shareholder meeting.
"We can't be unsuccessful in this journey," CEO Dave McKay said.
The bank, which is the largest lender to fossil fuels in Canada, was criticized for not moving fast enough on its net-zero activities.
McKay was also pressed on issues like the effects of oilsands extraction and the Coastal GasLink pipeline project.
RBC acts as a financial adviser to the pipeline project and also provides working capital. Wet’suwet’en hereditary chiefs, who don't support the pipeline, made their way to Toronto to ask questions about the bank's funding of it, but left unsatisfied.
Despite the pushback, McKay said the majority of Indigenous communities do support the pipeline. There are 20 Indigenous groups along the route that approve of the pipeline.
RBC: There's been quite a dispersion across the energy sector and stocks in terms of positive and negative impacts
"(The pipeline) presents very significant growth and economic opportunity for the communities that (it) passes through," he said.
Meanwhile, in his prepared remarks, McKay emphasized RBC's commitment to reducing global emissions in its operations by 70 per cent by 2025.
McKay said the bank is working closely with its clients on their net-zero strategies and intends on publishing emission reduction goals for its oil and gas, utilities and automotive portfolios this fall.
He added that a better approach to public-private collaboration is needed to address the transition to a net-zero economy.
Climate protests took place outside the meeting, which was changed to a virtual-only event late Wednesday.
This report by The Canadian Press was first published April 7, 2022.
Companies in this story: (TSX:RY)
Adena Ali, The Canadian Press
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