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Feb. 6, 2021, 6:04 p.m. EST

What new Amazon CEO Andy Jassy needs to do to become a leader in sustainability like Apple

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By Debbie Carlson

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A ‘real opportunity’ to be a leader

Behar says As You Sow has interviewed Amazon employees and says the company has a “real opportunity” to be a leader on human capital management, such as increasing hourly employee wages, improving health care benefits, especially during the pandemic, and paid leave, as well as improving efforts around diversity equity inclusion.

Lamb says with a new CEO coming on board, she wants greater clarity about defining gender and racial pay equity and to address diversity as a whole, noting that there are very few women and people of color in the company’s upper ranks. She says other shareholders are asking for a racial equity audit and for a worker representative on the board of directors, “which I think would be helpful.”

Climate inroads

When it comes to its climate pledge, Amazon is making some inroads. BloombergNEF said Amazon was the leading corporate buyer of clean energy in 2020, signing 35 separate clean energy power-purchasing agreements, totaling 5.1 gigawatts of power. BNEF says Amazon has now purchased over 7.5GW of clean energy to date, pushing it ahead of Alphabet GOOGL at 6.6GW and Facebook FB at 5.9GW as the world’s largest clean-energy buyer. 

Garvin Jabush, chief investment officer at Green Alpha Advisors, says Amazon’s investments in renewable energy and its $440 million investment in electric-truck start up Rivian are all impressive starts, but the company has a long way to go.

Green Alpha Advisors doesn’t own Amazon because Jabush says it is still a large contributor to climate risk; he noted the company saw a 15% increase in carbon dioxide emissions in 2019. It also supplies advanced computing data to the oil and gas industry to help fossil-fuel companies locate new deposits.

Opinion: The key lesson for Amazon investors as Andy Jassy takes over from Jeff Bezos

Both Jabush and Behar says Amazon faces material risk as it deals with electronic waste and plastic waste. Behar says it is trying to work with the e-commerce giant to reduce waste, noting the company could emulate Best Buy’s /zigman2/quotes/205918291/composite BBY -1.35% take-back program to recycle electronic waste. This could become a sustainable money maker by recouping the copper, gold and silver in used electronic parts, he says.

Reducing plastic waste is also critical since Amazon is a big user of packaging. Amazon has reduced Styrofoam usage, but “they could commit to zero plastic in two to three years from now and it would make a big difference,” he says.

Jabush says it’s always a debate at his firm each year about whether to buy Amazon because it is “a phenomenal business,” but he says until it reduces its climate impact, he won’t buy it. But with a new CEO, there’s an opportunity for change, Jabush says, pointing to how Tim Cook changed Apple after taking over from Steve Jobs.

“Sustainability was low on their priority list, and Tim Cook has made Apple into by far the most sustainable megacap in the world right now,” he says.

Debbie Carlson is a MarketWatch columnist. Follow her on Twitter @DebbieCarlson1.

More on ESG investing:

BlackRock’s push on ESG and climate goals is coming at ‘a business-friendly pace’

If you support green energy, you should buy utilities and oil stocks — here’s why

Your ESG investment may be a ‘light-touch’ fund and not as green as you think

ESG investing now accounts for one-third of total U.S. assets under management

/zigman2/quotes/205918291/composite
US : U.S.: NYSE
$ 104.74
-1.43 -1.35%
Volume: 3.38M
Sept. 24, 2021 4:00p
P/E Ratio
10.68
Dividend Yield
2.67%
Market Cap
$25.76 billion
Rev. per Employee
$463,353
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