BP’s Hypocrisy on Climate Policy

, climate accountability campaign director | December 19, 2018, 3:54 pm EDT
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This post was co-authored by Jo Alexander, Research and Engagement Manager with the UK responsible investment charity ShareAction. She previously worked at BP as a geologist but left when she felt compelled to work actively on climate solutions.

It’s officially shareholder season. This week ExxonMobil investors filed a resolution calling on the company to set and disclose carbon emissions reduction targets for its products and operations in line with Paris Agreement temperature goals. Earlier this month Royal Dutch Shell and institutional investors made a major announcement about steps the company will take to advance the Paris climate agreement. There’s been considerable press coverage of Shell’s emission reduction targets, but less attention on the company’s commitment to better align its climate lobbying with its stated positions, a move increasingly called for by shareholders at Shell and other fossil fuel companies. In 2017 the Australian mining and petroleum giant BHP Billiton Limited vowed to leave trade groups whose climate advocacy didn’t match up with the company’s climate goals.

Shell’s decision is significant, not only because it reflects the power of shareholder advocacy, but also because it shows growing awareness by fossil fuel companies that they can no longer expect to gain recognition as (relative) climate leaders while outsourcing the dirty work of spreading disinformation and blocking policies to trade associations and lobby groups. Whether Shell will proactively advocate for climate policies and urge its trade associations to do the same is yet to be seen. But it’s crucial the company has pledged to align its lobbying—and more companies should do the same, especially in light of two new, significant climate science studies.

The special report of the Intergovernmental Panel on Climate Change provides a stark picture of the climate disruptions we face with rising temperatures and the rapid economic transformation that is needed now if warming is to be limited to 1.5⁰C above pre-industrial levels. In the United States, the Fourth National Climate Assessment makes it clear that climate change is happening now, that it’s not affecting everyone equally, and that climate impacts—and their costs—will mount dramatically if carbon emissions continue unabated.

One part of the solution is to put a price on carbon pollution, which earlier this year U.S. voters in Washington state had the opportunity to vote on through ballot initiative I-1631. After initially pledging to fund the opposition to measure, Shell decided to stay on the sidelines. BP, on the other hand, spent a staggering $13 million to fight the community-oriented, solutions-driven proposal, which ultimately lost despite backing by a broad coalition of supporters.

BP’s opposition to the carbon fee directly contradicted its consistent, well-publicized claim that “carbon pricing provides the right incentives for everyone—energy producers and consumers alike—to play their part in reducing emissions.”

The company has repeatedly touted its support for the ambition of Paris climate agreement and called for a government policy framework, including a price on carbon, to help prevent the worst effects of global warming. The company is a founding member of the Climate Leadership Council, an organization created in 2017 that is advancing a bipartisan proposal for a federal carbon tax in the U.S.

Yet BP’s support of the “No on I-1631” campaign, sponsored by trade association Western States Petroleum Association (WSPA), goes against these sentiments and frustrates progress on much needed new carbon pricing law or policy. WSPA, which counts BP, Chevron, and ExxonMobil among its leaders and ConocoPhillips and Shell among its members also employed multiple deceptive campaign ads in 2015 to block provisions of a major clean energy bill enacted by California lawmakers. In response to a question at BP’s 2016 annual general meeting, CEO Bob Dudley said “of course we did not support that particular campaign” in California.

This year in Washington state, however, BP missed an opportunity to translate that statement into action. The company doubled down on its mistake by pouring millions of shareholder dollars into a campaign that misrepresented the intent and effects of the carbon fee proposal. BP and others brazenly bankrolled ads warning that “big corporations get a free ride, while Washington families, consumers and small businesses pay billions.” The fossil fuel industry-driven opposition campaign spread the misleading claim that the initiative excused the largest polluters when the legislation would have covered 80 percent of the state’s global warming pollution (85 percent after the shutdown of coal plants already slated for closure).

Inconsistencies between corporate words and deeds on climate change have real consequences for the climate, public policy and, increasingly, investment. Shell’s commitment in the context of the Climate Action 100+ initiative to align its climate lobbying with its corporate positions is a good first step, but more should be done. If Shell, BP, and other major fossil fuel companies are serious about carbon pricing, for example, they should ensure that they and their trade associations and lobby groups proactively advocate for climate policies. Companies have an opportunity and obligation to correct their course and back up their words with consistent, meaningful actions.

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