Trade Groups Must Be Challenged for Their Harmful Climate Deception

September 10, 2020 | 12:14 pm
Mark Fischer/CC BY-SA 2.0
Kathy Mulvey
Accountability Campaign Director, Climate & Energy Program

As we enter the home stretch of election season, the role of industry groups in spreading climate disinformation, obstructing climate policy, and supporting climate-denying political candidates is in the spotlight. These actions by groups such as the American Petroleum Institute (API) and the US Chamber of Commerce (US Chamber) raise reputational and legal risks for member companies and disproportionately threaten communities of color and low-income communities. No company should get kudos for splashy climate pledges unless it also insists that the industry groups it supports are working toward its stated climate goals.

Public officials at all levels of government, corporate leaders, and public interest organizations all have power—and responsibility—to strengthen business groups’ climate accountability. Here are my top five recommendations for holding trade groups accountable for climate deception—inspired by a recent United States Senate report; lawsuits filed by the state of Minnesota and the city of Hoboken, New Jersey; and analysis by nonpartisan research organizations.

1) Reveal trade groups’ membership, funding sources, and political spending

The chapter on so-called “Dark Money” in “The Case for Climate Action: Building a Clean Economy for the American People,” released last month by the Senate Democrats’ Special Committee on the Climate Crisis, points to the 2010 Citizens United decision by the US Supreme Court as the kickoff of a “power decade” of undue influence for fossil fuel corporations. The chapter describes the problem in stark terms: “Giant fossil fuel corporations have spent billions—much of it anonymized through scores of front groups—during a decades-long campaign to attack climate science and obstruct climate action.”

Peer-reviewed studies have documented more than 100 fossil fuel front groups, including the Heartland Institute and the Competitive Enterprise Institute, many of which have also lobbied for the tobacco industry. Fossil fuel companies also depend on trade associations to advocate for or against public policies, fund political candidates, challenge regulations in agencies and courts, and sponsor public relations campaigns. Some, like the API, focus all of their lobbying and public relations spending on oil and gas industry interests. Others, like the US Chamber, have broader memberships that imply they are speaking for the business community—but in reality, the US Chamber does the bidding of the fossil fuel industry when it comes to climate policy.

One key solution put forth in “The Case for Climate Action” is exposure: Congress should investigate who funds fossil fuel front groups and require trade group witnesses at Congressional hearings to disclose the funding and financial interests at stake.

2) Reform laws and regulations to strengthen transparency

Congress and federal agencies such as the Securities and Exchange Commission (SEC) have the authority to enact laws and regulations to mandate disclosure by corporations and trade groups. They should require transparency in political and election spending and enforce existing laws designed to prevent political corruption. Improved transparency by corporations and the groups that represent them is a precondition for passing comprehensive and effective federal climate legislation. Adoption of the DISCLOSE Act and SEC rules requiring corporate disclosure of political spending would be important steps toward fixing our campaign finance system.

3) Renounce trade groups that spread disinformation and oppose climate action

Corporate executives have considerable power—and responsibility—within trade groups. For too long, companies that claim to support strong climate policies have allowed fossil fuel interests to dictate the climate positions taken by trade groups such as the US Chamber of Commerce. As UCS and nine other organizations outlined in the AAA Leadership Framework, companies should align their trade associations’ climate policy advocacy to be consistent with the goal of net zero emissions by 2050. Corporate climate leadership means being willing to sever ties with trade groups that undermine that goal.

For example, the World Resources Institute recently showed that the US Chamber of Commerce’s 2019 Annual Scorecard elevates climate deniers. Of the 259 members of Congress who received the US Chamber’s “Spirit of Enterprise” award for pro-business votes, almost half were classified by the Center for American Progress Action Fund as “climate deniers.” Even more disturbing is that nearly 90% of climate deniers in Congress received the award.

Misalignment between a company’s stated positions and values and the actions of its trade and lobby groups can pose significant reputational risks. Under pressure from UCS and dozens of other organizations, since 2011 more than 100 companies with a total of $7 trillion in market capitalization have quit the climate-denying American Legislative Exchange Council (ALEC)—with a recent exodus over the group’s advocacy for racist and white supremacist policies.

Industry-specific trade associations are a tougher nut to crack. This year, API was unified behind its push to roll back health and safety regulations in the face of the COVID-19 pandemic. In 2017, not one member company distanced itself from API’s efforts to discredit a report from the National Association for the Advancement of Colored People (NAACP) and the Clean Air Task Force that highlighted the disproportionate risk of health problems facing Black communities in proximity to oil and gas facilities. More recently, BP, ExxonMobil, and Shell all publicly supported federal regulation of methane emissions from the oil and gas industry while maintaining leadership roles in API, which proposed and successfully lobbied for the rollback of Environmental Protection Agency (EPA) methane rules. As the “Dark Money” chapter notes, “It is impossible for the public to tell if the oil majors’ opposition was genuine or if it was public relations, with their real message conveyed to the EPA by their trade association.” Talk about having your cake and eating it, too.

But if reputational risk doesn’t get their attention, perhaps legal risk will. As the “Dark Money” chapter notes, member companies may even face liability for due diligence failures to monitor egregious misbehavior by trade associations.

4) Resist fossil fuel industry manipulation

Public interest organizations can and should also stand up to industry groups. The April 2019 NAACP report “Fossil-Fueled Foolery” documented how the fossil fuel industry manipulates communities, policy makers, and academia in ways that harm communities and pollute the environment. The report warns that “Some, but not all, fossil fuel companies and most, but not all, fossil fuel trade associations, engage in these tactics!” It calls out ALEC, API, and other fossil fuel lobby groups for tactics including:

  • Investing in efforts that undermine democracy;
  • Financing political campaigns and pressuring politicians;
  • Funding scientists and scientific institutions to publish biased research studies;
  • Contending that government regulations hurt the economy, rate payers, and poor people;
  • Denying or understating the harms polluting facilities cause to people and the environment;
  • Exaggerating the level of job creation and downplaying lack of quality and safety of jobs.

Knowing what manipulative tactics to look out for can help communities to resist and fight back against industry interference.

5) Recover costs of trade groups’ climate deception

Local and state decisionmakers have their own role to play in holding trade groups accountable. Since 2017, more than a dozen US cities, counties, and states have sued the fossil fuel industry accountable over its outsize role in climate change. This summer, for the first time, a trade group—API—was named as a defendant in lawsuits filed by the state of Minnesota and the city of Hoboken, New Jersey. Although API members were warned of the dangers their products posed to the global climate more than 50 years ago, the group has a long history of spreading climate science disinformation—exemplified by a notorious 1998 internal memo by an API task force laying out a plan to deliberately cast doubt on the public’s understanding of climate science.

The Minnesota complaint outlines a multifaceted campaign of deception by ExxonMobil, Koch Industries, and API over the past 30 years, details impacts and costs incurred by the state as a result of climate change that has gone unchecked due to this deception campaign, and seeks damages as well as funding for a public education campaign about climate change. Attorney General Keith Ellison says it’s his duty to hold corporations and trade associations accountable when they break the law and hurt Minnesotans, and emphasizes that climate impacts hurt low-income communities and communities of color first and worst.

The Hoboken complaint alleges that ExxonMobil, Shell, other major oil and gas companies, and API intentionally misled consumers, investors and the general public about how their products contribute to climate change. Mayor Ravi Bhalla recognizes climate change as a racial justice issue, noting the disproportionate impacts of pollution, extreme heat, and flooding on low-income communities and communities of color. The lawsuit asks the court to order API and these fossil fuel companies to end their disinformation campaigns, provide relief for consumers, and be held accountable for their share of climate change-related damages.

To learn more about the broad and continually evolving landscape of science and climate litigation in the US and around the world, visit the webpage of UCS’s Science Hub for Climate Litigation. Or register here to join a virtual discussion with a distinguished group of scientific and legal experts on Thursday, September 17, at 11am EDT.