A coalition of 25 institutional investors with over $69 billion in assets under management is calling on nine large London-listed companies to review their membership of lobbying groups they say seek to obstruct EU climate policy.
The investors have written to BHP Billiton, BP, EDF, Glencore, Johnson Matthey, Proctor and Gamble, Rio Tinto, Statoil and Total saying their declared climate policies are undermined by their memberships to various organisations.
“These international investors are united in the need to challenge companies who belong to trade associations that lobby obstructively behind closed doors to weaken climate policy in the EU,” said Catherine Howarth, Chief Executive at campaigners ShareAction, which coordinated the action.
They cited a March study by the UK’s University of Westminster, which found companies make heavy use of eight trade associations that are lobbying against EU climate policy.
The research focused on the associations’ work around structural reforms to the EU ETS and the 2030 EU energy and climate framework. It compared this to company declarations on climate compiled by CDP.
FIRMS JOIN BUSINESSEUROPE
One such trade body is BusinessEurope, which represents European businesses in Brussels via national employer federations. It also operates an Advisory and Support Group that lobbies on behalf of corporate members, including four of the firms to which the investors wrote.
“Every company does its own assessment of the advantages of belonging to BusinessEurope Advisory and Support Group (ASG), which is a growing group,” a BusinessEurope spokesman told Carbon Pulse.
Unilever quit the group last year in favour of working more closely with “likeminded” companies, hinting at tensions over the lobby group’s stance on environmental policies and sustainability issues, BusinessGreen reported.
Yet Unilever’s decision has not been followed by other companies, and the group’s membership has increased to 67 from 61 over the past 18 months.
Internet records show that as well as Unilever, elevator manufacturer Schindler and Imperial Tobacco have left, while nine other firms have joined: Eni, EDF, Huawei Technologies, Intel, Jaguar Landrover, Norsk Hydro, Renault Nissan, Safran, TE Connectivity.
NUANCED CLIMATE STANCE
In a statement responding to the letters, BusinessEurope president Emma Marcegaglia and director general Markus Beyrer described their ‘naming and shaming’ by the investor groups as a “very inaccurate and biased view” of its positions on climate change.
“We have a clear message on climate change and the ETS and are fully engaged in working towards getting a global climate deal,” a BusinessEurope spokesman told Carbon Pulse.
He referred to the group’s 10 priorities for the December Paris summit.
“We have given our position, we are clear that other large economies also need to act. Otherwise we will find our industries at risk of carbon leakage, and we don’t ignore that risk.”
The statement said: “climate change is a global challenge that requires global action. This is why we believe carbon pricing and the development of a global carbon market should play a stronger role in the future.”
BusinessEurope admitted its attitude to EU ETS reforms had been mixed.
“While opposing backloading–which we believe was an ad-hoc quick fix to a much deeper problem – we clearly support a reform of the system to achieve less carbon price volatility in the future (the ‘Market Stability Reserve’),” the statement said.
In July, BusinessEurope said the European Commission’s post-2020 ETS reform proposal failed to safeguard the competiveness of Europe’s industries by reducing their volume of free allowances, but it welcomed the expanded access to an EU innovation fund for low carbon technologies.
“While we hope that the growing worldwide political momentum for a turning point in Paris results in an ambitious global agreement, it remains unclear whether and how industrial sectors from other major economies, acting on global markets, will embark on comparable emission reduction efforts as the EU industry,” the group said in response to the proposal.
- Investors signing Wednesday’s letters to the nine companies include: Boston Common Asset Management, AP4 Swedish National Pension Fund, The Pensions Trust, UNISON Staff Pension Scheme, Australian Ethical Investment, Barrow Cadbury, Christopher Reynolds Foundation, The Joseph Rowntree Charitable Trust, Walden Asset Management, Sarasin & Partners LLP, Arjuna Capital, Jesuits in Britain, Zevin Asset Management LLC, Effective Assets, Barrow Cadbury Trust, LankellyChase Foundation, Polden-Puckham Charitable Foundation, The Baring Foundation, Ashden Trust, JJ Charitable Trust, Mark Leonard Trust, Tellus Mater Foundation, Mercy Investment Services Inc. and Tri-State Coalition for Responsible Investment.
By Ben Garside – email@example.com