BP to be more transparent about climate efforts amid investor concerns

Irving Hamilton
February 3, 2019

And it would have to set out its anticipated levels of investment in oil, gas and other energy technologies, its goals for reducing operational greenhouse gas emissions, the estimated carbon intensity of its energy products, and how its targets are linked to executive pay.

Energy giant BP will get behind a shareholder effort which would require it to work towards the goals of the Paris climate change agreement.

But BP urged investors to reject a tougher climate resolution brought by a Dutch shareholder activist group, which it said was too prescriptive.

This disclosure will be a part of BP's annual reports from 2019.

Following talks with a large group of investors, BP also agreed to back a shareholder resolution on the measures at its annual general meeting (AGM), further evidence of the way the energy industry and investors are engaging on climate issues.

He said that the reporting will "build on BP's history of progressive action in this area".

The approved resolution sets targets and allows disclosure as long as it is "prepared at reasonable cost; and provided that nothing in this resolution shall limit the company's powers to set and vary its strategy, or associated targets or metrics", BP said.

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Helge Lund, the chairman of the company, stated: "BP is committed to helping solve the dual challenge of providing more energy with fewer emissions".

BP said today that it will support a shareholder proposal calling on the company to set out a business strategy consistent with the goals of the Paris climate agreement.

Shell, for example, said a year ago that it would start linking executive pay to short-term carbon emissions targets in 2020 after coming under pressure from shareholders including the Church of England.

The two sides disagreed on whether the company had shown it was consistent with the goals of the climate accord. It said, however, that Royal Dutch Shell did agree late previous year to set carbon emissions targets including those from customers.

"In accordance with the proposed resolution BP will describe how its strategy is consistent with the Paris goals, as well as setting out a range of additional related reporting", the company said in a statement this morning.

Low-carbon leader or laggard? "It's encouraging to see major companies such as BP moving in the right direction".

Investors and environmentalists welcomed BP's announcement, while stressing they will continue to monitor its climate performance. These emissions are much bigger than those from the company's operations. It forced it to be more transparent on climate change.

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