Environmental NGOs urge P&G investors to not reelect CEO Joe Moeller as board chair

Friends of the Earth International, a network of environmental organisations in the US, is calling for P&G's investors to vote against reelecting CEO Jon Moeller as board chair and replacing him with an independent board chair. It is also opposing the renomination of corporate directors Angela Braly, chair of the governance and public responsibility committee and Patricia Woertz, a member of that committee, according to an SEC filing.

Although 67% of shareholders urged P&G in 2020 to increase the scale, pace and rigour with which it addresses environmental and social harms linked to its sourcing of pulp and palm oil, the filing said P&G’s current leadership has taken "insufficient action" to respond to the systemic, material risks of P&G’s ongoing exposure to deforestation, primary forest degradation, and human rights violations in its pulp and palm oil supply chains. It added that P&G’s board chair and governance and public responsibility board bears "significant responsibility" for continued risk exposure.

"P&G’s actions have been insufficient to mitigate deforestation and forest degradation risk and associated human rights risk, and may leave the company exposed to significant material operational, reputational and legal risks," the filing said.

The FMCG giant said on its website that environmental sustainability is embedded in how it does business. More specifically, the filling quoted P&G's proxy statement, saying that the board and its committees are "actively engaged in [its] environmental and social efforts". Yet, the filling alleged that Moeller, Braly, and Woertz's track records show that they each lack the professional skills to guide P&G on sensitive environmental, social and governance issues.

"Their close association with companies known for science denial and regressive approaches to sustainability presents a conflict of interest in managing and mitigating risks to climate-critical forests," the filing said. 

By replacing Moeller with an independent board chair, the filing said that P&G leadership will be more apt to respond when the company fails to meet its mandate or that of shareholders, as well as to implement corrective measures and proactively embrace changes in consumer and marketplace expectations.

Quoting a P&G spokesperson, Reuters said P&G's directors have received support from more than 90% of investors in 2021, adding that the FMCG giant has also released reports showcasing its efforts. They include revealing more data and removing sourcing from certain forests. Investors will vote on the reelection of P&G's corporate directors during its upcoming annual meeting on 11 October. MARKETING-INTERACTIVE has reached out to P&G for comment.

Meanwhile, P&G's Forestry Practices Report 2022 said among the list of actions on this front include independent audits, satellite monitoring to ensure no sourcing from intact forests, P&G audits, and public greviance process and reporting. All its wood pulp is also third-party certified to ensure the protection of environmental and social values of forests.

At the same time, it is also testing a bamboo product - Charmin Ultra Eco - and developing a plant-based fibre product. "We remain committed to learning from others, testing our thinking and reporting on our progress. We believe that responsible sourcing is important, not just for our business, but also for the environment and people who depend on it," the company added.

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