UBS Efforts to ‘Water Down’ DEI Policy Slammed by Proxy Adviser
(Bloomberg) — An influential investor group blasted UBS Group AG over a perceived retreat from sustainability policies, highlighting the reputational risks that banks face when they roll back previous commitments.
UBS “has watered down its ambitions in terms of climate change, diversity and equality as well as investment exclusion criteria,” the proxy advisor Ethos said in a statement on Thursday. “UBS has taken steps backwards.”
The criticism comes shortly after UBS published its 2024 sustainability and annual reports, in which it omits references to diversity, equity and inclusion. By comparison, the lender’s reports a year earlier mentioned DEI 21 times.
Banks globally are adjusting sustainability policies against an increasingly tense political backdrop. The US administration under President Donald Trump has referred to DEI as “radical and wasteful” while dubbing climate goals such as net zero as “terrible” and “sinister.”
Since Trump’s election win, Wall Street’s biggest banks have all left the Net-Zero Banking Alliance, the world’s biggest climate alliance for the bank industry. In January, UBS Chief Executive Officer Sergio Ermotti said he’s looking into whether UBS should follow suit.
Best Paid
UBS’s executive pay attracted criticism from Ethos too, with the group saying it remains “too high.” Ermotti was awarded just under 15 million Swiss francs ($17 million) for 2024, making him one of Europe’s best-paid bank CEOs.
The bank’s shareholders should also vote against UBS’s plans to buy back shares, Ethos said. The bank should instead strengthen its capital base, it said.
Ethos says it acts as a proxy adviser for pension funds and represents about 3% to 5% of UBS’s shareholders. The group’s recommendations aren’t binding.
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