Follow This, the share-owing campaign group, has filed a climate resolution at UK oil and gas major BP, on the same terms as the one it filed at Shell for the fourth time this year, as reported last week by RI.
It’s the first time Netherlands-based Follow This has filed a resolution at any company other than Shell.
Follow This is offering the two oil majors shareholder support to set reduction targets of scope 1, 2 and 3 emissions, seeking unequivocal alignment with the Paris Agreement goals.
“We won’t stop until scope 3 is the new normal for oil companies,” Mark van Baal, the founder of Follow This, told RI.
Follow This would consider filing the same resolution at ExxonMobil and Chevron in the US, provided no other shareholder does so before the deadline.
The new resolution, which BP has confirmed it has received, comes in the wake of a joint statement between Shell and Climate Action 100+ (CA100+), the group of leading institutional investors.
In the joint statement Shell pledged “to set short-term targets” as steps to achieve its “long-term ambition” of reducing emissions. It also pledged to link these three-five year targets to executive remuneration.
A spokesperson for BP told RI that the Follow This resolution would be considered “carefully” and that “we engage with Climate Action 100+ on a regular basis throughout the year”.
The BP spokesperson also confirmed that the deadline to file resolutions without costs for shareholders has been set for January 21 2019.
“Everything to do with BP runs a month later than everything to do with Shell,” said Helen Wildsmith, Stewardship Director, Climate Change at CCLA Investment Management.
Wildsmith was one of architects of the ‘Aiming for A’ initiative, which later merged into the Institutional Investors Group on Climate Change (IIGCC) which is part of the CA100+.
She is also the Co-chair (together with Hermes’ Bruce Duguid) of the resolutions sub-group within IIGCC’s corporate programme. Wildsmith leads on Rio Tio, Chevron and Duke Energy, while Duguid focuses on BP.
Asked whether CA100+ could seek a similar joint statement with BP or file its own resolution, Wildsmith said it would be too early to tell.
She said: “The most important proposals for the next season are going to be the ones across the globe that come from the institutional investors. Within CA100+ the use of resolutions globally is part of the process.”Adam Matthews, Director of Ethics and Engagement at the Church of England Pensions Board, spoke at BP’s AGM last year asking the company to take responsibility for scope 3 emissions.
Research by the Transition Pathway Initiative, which he co-chairs, shows no progress at BP.
“They don’t acknowledge targets for scope 3, which for me is a real issue. We hope the company comes forward with a clear strategy. At the moment I’m not seeing it and I think the steps Shell has taken really underlines that it is possible,” he told RI.
Matthews, who is Co-lead of the CA100+ dialogue with Shell, told RI that he would prefer the shareholder proposal filed at Shell to be withdrawn.
Asked before the latest Follow This announcement if he would support a resolution at BP, Matthews said that potential adequate resolutions could be seriously considered given the lack of progress of the British oil major.
Asked whether the CoE Pensions Board could file or co-file resolutions at BP, he said: “Serious conversations are under way amongst all of the investors networks on the CA100+, where resolutions are being considered at oil and gas companies, and obviously we are one of those investors in that conversation.”
At the Carbon Tracker Initiative, Andrew Grant, Senior Analyst, told RI that oil majors try very hard not to label these announcements as targets or commitments but ambitions or aspirations.
Grant said: “The scope 1-3 targets announced to date are all framed in relative terms – amount of CO2 emitted per unit of energy produced. This is because the companies all still intend to produce more and more oil and gas in absolute terms – therefore, has anything really changed?”
Grant added: “We estimate that around 30% of BP’s “business as usual” capital investment does not work in a 1.75 ºC scenario. Given that there is a finite and limited amount of carbon that can be released into the atmosphere under our climate obligations, investors should scrutinise fossil fuel producer plans at the project level and make sure that this fact is reflected in their capital allocation strategies.”
ShareAction, the responsible investment campaign group which co-filed last year’s resolution at Shell with Follow This, was not available for comment.
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