BP to Support Investor Resolution on Climate, but Will Announcement Be Followed With 'Concrete, Bold Action'?
FOR IMMEDIATE RELEASE
MEDIA CONTACT: Stefanie Spear, [email protected], 216-387-1609
Oakland, CA — Feb. 1, 2019 — BP announced today that it will support a resolution from investors of the Climate Action 100+ initiative asking the company to broaden its corporate reporting to describe how its strategy is consistent with the goals of the Paris Agreement. The energy giant said the BP board has decided to support the proposed resolution, which will be put to shareholders at the company’s annual general meeting in May 2019.
This announcement is important. The physics of climate change demand that every oil and gas company must immediately begin to reduce its greenhouse gas emissions compliant with Paris Agreement targets.
BP has not yet described what concrete actions it is adopting to be aligned with Paris goals or even how it defines these goals and we look forward to seeing that information. Over the past year, a large number of companies have claimed their operations are in line with Paris goals while only committing to reduce operational emissions. This is NOT alignment with Paris goals.
Shell provides an example of a company moving in the right direction toward alignment with Paris goals by setting a target to reduce the intensity of emissions from of its products (Scope 3). While Shell has only agreed to relative reductions in Scope 3 emissions, not absolute reductions as needed to achieve the Paris goal — BP has not even gotten to that level. BP appears to have committed only to setting operational targets. BP’s linkage of its goals with compensation is important, but details about that compensation also remain to be disclosed.
It is past time for oil and gas companies to adopt goals to reduce their full scope of emissions in line with Paris goals. Companies that fail to take action are at risk not only from lack of competitiveness, reputational risk, and lost opportunities, among others, but because investors are increasingly likely to move their investments to those companies that are taking action. Companies like BP are beginning to recognize the need to take action to survive in a low carbon economy and retain their competitive position. We wait for further information from BP to understand whether it is taking meaningful action to address these concerns.
Danielle Fugere, president of As You Sow, had this to say about BP’s announcement:
“BP today announced that it will report on how it is aligning its strategy with Paris goals. To be aligned with Paris goals means adopting fundamental changes in the way business is done across the full scope of its activities — including reducing operational emissions, invested emissions, and product emissions. To align with Paris, BP would have to diversify into clean energy production, shrink current investments in oil and gas development, or otherwise reduce its full range greenhouse gas emissions. Is it doing so? We will stay tuned.
Lila Holzman, energy program manager of As You Sow, had this to say about BP’s announcement:
“BP needs to follow its announcement with concrete, bold action. BP’s statement shows that it is recognizing investor concerns regarding its significant climate risks and responsibilities. Now BP must show it will meet urgent climate goals.
“At the same time, investors must continue to push companies toward full Paris-compliance or risk falling short of preventing the worst scenarios of catastrophic climate impact.”
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As You Sow is a nonprofit organization that promotes environmental and social corporate responsibility through shareholder advocacy, coalition building, and innovative legal strategies.