Investors turn up the heat on US climate laggards

200 of the world’s leading investors have written to major US corporations urging them to align their climate lobbying with the goals of the Paris Agreement.

The joint letters, sent on behalf of the Investor Expectations on Corporate Climate Lobbying group, which includes BNP Paribas Asset Management, Boston Trust Walden Company, Mercy Investment Services, and the New York State Common Retirement Fund, were sent to 47 of the largest US publicly traded corporations.

The companies, which are on the Climate Action 100+ focus list and have been identified as some of the largest corporate greenhouse gas emitters, span the airline, electric power, auto manufacturing, oil, military equipment, chemical, beverage and retail industries.

They include American Airlines, American Electric Power Company, Chevron Corporation, Exxon Mobil, PepsiCo, Coca-Cola, Wal-Mart Stores, and Ford Motor Company.

The letters, sent on 11 September 2019, warn that lobbying activities that are inconsistent with meeting climate goals are an investment risk.

“As investors, we view fulfilment of the Paris Agreement’s goal – to hold the increase in the global average temperature to well below 2°C above preindustrial levels, and to pursue efforts to limit the temperature increase to 1.5°C – as an imperative.

“We are convinced that unabated climate change will negatively impact our clients, plan beneficiaries, and the value of our portfolios. The IPCC’s report issued in October 2018 makes it clear there is still time to avert serious consequences, but expanded action must begin immediately,” the letter states.

The letter states that major companies have a significant influence on climate and energy policies. The group said it was “concerned about lobbying activities” which it considers to be “inconsistent with addressing the risks posed by climate change.”

The group wrote: “In particular we ask for a review of your own corporate lobbying activities as well as the trade associations and other politically active organisations of which you are a member that represent business interests but, unfortunately often lobby against public policy initiatives addressing the climate crisis.”

The investors have given the companies a deadline of 8 November 2019 to make public the steps taken to align with these expectations.

European investors presented a similar letter to a large group of European companies last year. As a result, a dozen companies, including Royal Dutch Shell, BP, Unilever and Equinor, have committed to making changes to their corporate lobbying.

“Climate change is one of the greatest risks facing long-term investors,” New York State comptroller Thomas DiNapoli, trustee of the New York State Common Retirement Fund, said.

“Many companies talk the talk when it comes to building a lower-carbon global economy, but some continue to support agendas and groups that oppose the goals of the Paris Agreement. We need greater transparency and accountability from our portfolio companies,” DiNapoli added.

During recent regulatory proceedings over federal auto fuel efficiency standards and methane emissions from oil and gas production, some companies’ public statements were at odds with lobbying being done by their trade associations. 

“As investors, we can’t allow the companies we invest in to green-wash the public while wagering on climate destruction and regulatory roll-backs in secret. Companies must be held accountable for their words and actions,” New York City Comptroller Scott Stringer said.

“Lobbying must be transparent, disclosed annually to shareholders, and consistent with the Paris Agreement. Our pensioners and our planet depend on it,” Stringer added.

Last Updated: 22 September 2019
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