BP Shareholders Vote in Favour of Greater Climate Disclosure

BP shareholders yesterday voted overwhelmingly in favour of a proposal asking the oil and gas major to make greater disclosures about how its business aligns with the Paris climate goals.

However, support for a separate shareholder resolution demanding hard targets for emissions, including those of its consumers, was far lower.

The two resolutions came from investors at BP’s annual meeting in Aberdeen yesterday, as pressure builds on BP to show they are taking action on climate change.

BP’s board backed the proposal by Climate Action 100+, a coalition of some of the world’s largest investors that manage $32tn in assets, calling on BP to make greater disclosures on its emissions and show how its investments and business strategy align with the Paris climate goals to limit global temperature rises.

An overwhelming 99 per cent of shareholders voted in favour of the resolution.

Shareholders did not back the second investor resolution by Dutch group FollowThis, calling on the company to set hard targets not just on its own emissions but those of its consumers, such as those who use its petrol and diesel. Only8 per cent of shareholders voted in favour.

While Norway’s Equinor has also dismissed this push, rival Royal Dutch Shell has committed to including these consumer emissions into its targets.

BP said third-party emissions were out of its control. “We do not feel comfortable in setting goals for others,” BP’s chief executive, Bob Dudley said.

BP’s AGM took place on the same day as Shell’s, with both dominated by shareholder questions about the duo’s approach to climate change. Some investors urged greater clarity on which oil and gas projects are the costliest and most economically at risk should global demand for fossil fuels fall.

BP said it would make such disclosures later this year in its annual report published by April.

“The key concern of investors is that BP has not demonstrated that its strategy is consistent with the Paris climate goals” said Bruce Duguid, at Hermes EOS who is leading discussions with BP, in an interview ahead of the annual meeting.

BP said its strategy was compliant with these targets, setting itself at odds from the outset with investors and environmental activists who question how the energy major can be aligned with the Paris goals while focusing on increasing oil and gas production.

“My mission is to see BP advancing the transition while remaining an attractive investment proposition,” said Helge Lund, BP’s chairman.

Mark van Baal, at Follow This, said the votes in favour of his group’s proposal were still higher than a similar resolution filed at Shell’s AGM last year, which ultimately triggered a change in position.

“Do you really think the emissions of your products are not your problem?” he told BP’s board.

Adam Matthews, director of ethics for the Church of England’s pension board who is leading CA100+’s discussions with Shell, said the Anglo-Dutch group’s commitment to include customer emissions were “transforming the debate” between investors and energy companies.

While Shell has broadly won praise for this move, at its AGM in the Netherlands it still faced sharp criticism from activists, who said the company was not doing enough and would never be able to change its business in time to avert catastrophic climate change.

One Dutch group, called Code Rood, addressed the board saying they believed this would be the last ever Shell AGM, while another, Shell Must Fall, accused the company of “ecocide”.

Charles Holliday, Shell’s chairman, said that while he respected their right to protest he also had a clear message: “We’ll be here next year.