Two investor advisers recommend BP shareholders oppose activist climate resolution
Reuters
Published Apr 14, 2023 10:58
Updated Apr 14, 2023 18:50
By Ron Bousso
LONDON (Reuters) -Investor advisers ISS and Glass Lewis have recommended BP (LON:BP) shareholders oppose a climate resolution filed by activist group Follow This at the oil company's annual general meeting later this month.
Follow This said in December it had co-filed resolutions with six major institutional investors managing $1.3 trillion in assets ahead of the annual general meetings of BP, Chevron (NYSE:CVX), Exxon Mobil (NYSE:XOM) and Shell (LON:RDSa).
Follow This wants the firms to commit to absolute carbon emissions cuts by 2030 in line with the Paris climate deal.
Those include emissions from the combustion of the fuels they sell, known as Scope 3 emissions, which account for the majority of emissions.
"The proposal would represent a change in strategy from the one developed by the Board, which implies a potential constraint on the Board to develop and implement strategy," ISS said in a note to investors.
Glass Lewis said in a note that the Follow This resolution "fails to acknowledge the significant uncertainty and complexity in managing and measuring Scope 3 emissions."
"We believe that the Company should be shown some degree of latitude with respect to refining and specifying its targets," it said.
In February BP rowed back on plans to slash oil and gas output and emissions. It will not offer shareholders a vote on its climate strategy as it did last year when they backed it.
Follow This founder Mark van Baal said in reaction that "ISS and Glass Lewis advise what they believe is best for the company rather than what is best for the global economy. In the case of BP, ISS and GL appear to believe that increasing overall emissions by 2030 is beneficial to the company."
Britain's Local Authority Pension Fund Forum (LAPFF) this month recommended investors support the Follow This resolution.
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