Two major investors in Duke Energy are urging fellow shareholders to boot out four directors over the company’s coal ash problems.
The California Public Employees’ Retirement System and the New York City Pension Funds wrote fellow shareholders Monday. They asked that shareholders not re-elect four members of the Duke board’s regulatory policy and operations committee at the May 1 annual meeting.
The committee members – Alex Bernhardt, James Hyler, James Rhodes and Carlos Saladrigas – have oversight of Duke’s environmental, safety and health compliance.
The letter cites the Feb. 2 ash spill into the Dan River, saying Duke had “forewarning of the public risk” from environmental groups that had intended to sue Duke over ash contamination.
None of the committee members has coal industry or other relevant experience, CalPERS and New York City comptroller Scott Stringer wrote. The letter says cleanup costs are expected to be massive and note an ongoing federal grand jury investigation.
“In light of the serious failures of oversight, scale of impact on the company’s risk profile and the poor response to shareowner enquiry thus far, we urge our fellow investors to hold the relevant board members accountable ...,” the letter concludes.
Duke had no immediate comment.
CalPERs owned $140 million in Duke stock in 2013. The New York City funds have $62 billion in U.S. stocks, although it’s unclear how much of that is Duke stock.
Nineteen institutional investors asked Duke’s board last month to investigate ash problems, including cleanup costs and whether management acted improperly.
In a response Monday, regulatory policy committee chair Philip Sharp outlined the internal reviews, consultants’ assessments and ash pond closures Duke has previously described. Sharp will retire from the board this year.
“If, at any time, we believe the company’s shareholders would be better served by the board or committee initiating an independent investigation, separate from the thorough reviews already underway by the company and various state and federal regulators, we will not hesitate to do so,” Sharp wrote.