Furthering safe rail transportation for oil

Shareholder advocacy |

Conversations started with Union Pacific over oil transportation

Praxis Mutual Funds and other investors are participating in shareholder advocacy conversations with Union Pacific – the largest railroad company in the U.S. – about how the company addresses safety concerns related to transporting of crude oil.

Crude oil accounts for a very small, but growing percentage of Union Pacific’s total business. Discussions have centered on board-level oversight of safety programs, Union Pacific’s approach to hazardous materials, the rail cars themselves, and a review of the emergency response process.

The shale oil boom of the last few years has pushed rates of United States oil production to an all-time high.1 However, a lack of adequate pipeline capacity to move this burgeoning supply to market has led to a steep increase in oil transport by rail.2

The increased crude oil rail traffic – a 4,000 percent jump since 2008 in some places3 – leads to questions about safety. Train derailments and rail car fires have made headlines, including the 2013 train derailment in Lac Mégantic, Quebec, which killed 47 people. The train reportedly carried crude oil from the Bakken region of North Dakota.

1U.S. Energy Information Administration, June 2015.

2Association of American Railroads, 2014.

3U.S. Department of Transportation, December 2014.

Disclosure

As of June 30, 2015, the Praxis Growth Index Fund has invested 0.90 percent of its assets in Union Pacific. Fund holdings are subject to change. To obtain holdings as of the most previous quarter, visit praxismutualfunds.com.

The Fund’s stewardship investing strategy could cause the fund to sell or avoid securities that may subsequently perform well, and the application of social screens may cause the fund to lag the performance of its index.