Once upon a time you dressed so fine

Threw the bums a dime in your prime, didn’t you?

People call say ‘beware doll, you’re bound to fall’

You thought they were all kidding you

You used to laugh about

Everybody that was hanging out

The issue of Berkshire Hathaway and climate change is no longer a laughing matter for you. Last month I wrote about how the times they are a changin’ for you and Berkshire Hathaway. A majority of non-insider shareholders, I estimate at 60 percent, voted in favor of a shareholder proposal submitted by the California Public Employees Retirement System (CalPERS), EOS at Federated Hermes, and Caisse de dépôt et placement du Québec (CDPQ) which requests “that the board of the Company publish an annual assessment addressing how the Company manages physical and transitional climate-related risks and opportunities, commencing prior to its 2022 annual shareholders’ meeting.” If I heard you correctly, during the Q&A portion of the shareholders’ meeting webcast globally by Yahoo Finance, you called this shareholder proposal “asinine.” In response, Jim Cramer of CNBC called your position “preposterous.”

It is especially preposterous because prior to expressing his outrage over asinine requirements Mr. Buffett stated that merely three companies (which he didn’t name) out of around 60 account for 95 percent of carbon emissions. I’m thinking, “Gee, can’t be all that hard to do this for only three companies, right?”

In the months prior to this vote, I politely suggested to you and your good friend Mr. Bill Gates that you vote in favor of this proposal. Doing so would have put you on the right side of history and enabled Mr. Gates to match his actions with his rhetoric.

Unfortunately, but I guess not surprisingly, neither of you gentlemen followed my advice. You remain on the wrong side of history when it comes to climate change. Those who are skeptical about whether Mr. Gates is putting deeds to words have even more reason to do so. Both of you are Like A Rolling Stone into a cloud of greenhouse gas (GHG) emissions.

There is still time for redemption for both of you. You are clearly very smart men (and must be great bridge players!) and I’m hopeful this letter will persuade you to change your views in time for the likely similar shareholder proposal that will be voted on at the 2022 Berkshire Hathaway annual meeting. When you ain’t got nothing, you got nothing to lose. Thus, I would like to share a summary of some very useful analysis done by Climate Action 100+ and a team of climate experts at Ceres (Ceres is a founding partner of the Climate Action 100+ initiative.

Let’s start at the parent company level since investors can’t throw a dime at any of the subsidiary companies. Berkshire Hathaway is one of the companies assessed in Climate Action 100+ NetZero Company Benchmark analysis. Climate Action 100+ is a global initiative made up  of 575 investors representing $54 trillion in assets under management who are engaging with 167 companies that account for over 80 percent of global GHG emissions. The bar chart below shows the aggregate dismal results which indicate how far we have to go in getting the world’s largest GHG emitters to get serious about climate change. Only about one-third of the companies meet all criteria for a net-zero ambition by 2050 (or sooner), by having both long-term goals for GHG reduction targets for 2036-2050 and proper climate governance in place. One-fifth have medium-term (2026-2035) reduction targets, eight percent have short-term targets (up to 2025), 14 percent have a decarbonization strategy, and 13 percent are doing proper TCFD (Task Force on Climate-related Financial Disclosures) reporting.

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