A nonprofit investor that tracks corporate performance on environmental, social and governance issues is asking Sunbury-based Weis Markets to beef up its disclosures on climate change and supply chain risks.
- The Massachusetts-based nonprofit, The Accountability Board, is seeking a shareholder vote on the issue during Weis’s annual meeting this spring.
- The resolution calls on Weis to produce a report on its thinking behind climate and supply chain risks and how it’s managing them.
- “In an age of supply chain disruptions across many industries, when one looks through Weis’s regulatory filings, it’s nearly impossible to find any kind of meaningful disclosure of supply chain risks in general, let alone the risks stemming from climate change,” said Matthew Prescott, president and CEO of The Accountability Board, which has a stake in about 150 companies, primarily in food and retail.
- Prescott said grocers like Albertsons, Kroger and Walmart discuss the issues at greater length.
- Albertsons, for example, discloses that extreme weather shifts could hamper both the volume and quality of crop production, Prescott said.
- Kroger and Walmart both warn that climate change could affect the availabality of certain commodities.
What does Weis say: The grocery chain notes in its annual report that “Business disruptions due to weather and catastrophic events may also affect our business. The company’s geographic regions could receive an extreme variance in the amount of annual snowfall that may materially affect sales and expense results.”
- The company also acknowledges that labor and supply chain disruptions in 2022 and 2023 delayed its work on renovating stores and opening new ones.
- A Weis spokesperson pointed to a securities filing where the Weis board recommended voting against the proposal from The Accountability Board.
- “Overseeing and managing our supply chain against risks, including weather and climate, remains an important priority for the company,” the board wrote, noting that the additional disclosures called for by The Accounting Board would not add value for shareholders.
What’s next: Shareholders are scheduled to vote on the disclosure measure at Weis’s annual meeting, scheduled for May 2.
- Prescott doubted the proposal would pass, since Weis family members are majority shareholders in the company.
- But he hopes a majority of outside shareholders approve, which would signal to company executives that they should pay better attention to risks posed by climate change, he said.
- The U.S. Securities and Exchange Commission finalized rules this month requiring publicly traded companies to disclose more information about climate change risks.
- But the rules face a raft of legal challenges.
Have we been here before: Sort of.
- Three years ago, activist shareholders pushed for governance changes at Weis.
- They wanted to split the chairman and CEO roles held by Jonathan Weis and change the voting rules for company directors.
- The voting proposal was rejected while the chairman/CEO motion was withdrawn.
The background: As of the end of 2023, Weis operated 197 stores in Pennsylvania, Delaware, Maryland, New Jersey, Virginia and West Virginia.
- The company had sales of nearly $4.7 billion, roughly even with its sales in 2022, according to its annual report.
- But as the cost of doing business rose, its net income fell to $103.8 million for the year, down from $125.2 million in 2022.
