Corporate lobbying has always existed, but only in recent times have investors concerned with sustainability started to monitor the impact of the lobbying activities of their investee companies. 

Lobbying by companies has often been conducted against regulation or legislation aimed at slowing down climate change, even when companies have committed to reduce greenhouse gas emissions. 

It is vital that investors become fully aware of this reality and start holding companies responsible for their lobbying activities more widely.  


Starting from around 2015, initiatives from the UN-backed Principles for Responsible Investment (PRI) and a group of prominent institutional investors have helped to put corporate lobbying firmly on the sustainable investment radar. 

In the space of a few years, investors have gained some important victories, with a growing number of companies starting to report on their lobbying activities and reviewing their membership of industry associations. Standard practices for engaging with companies on this issue are emerging. This is part of the wider sustainable investing trend, which continues to power on and evolve at an extraordinary pace.  

Awareness of the impact of corporate lobbying has grown among investors, but the number of companies that report on their activities is still very low. Transparency is seriously lacking, as is action by companies to rectify their behaviour. 

Lobbying is not always conducted in a transparent fashion or through conventional channels of policy advocacy. Furthermore, lobbying in relation to sustainability is not confined to climate regulation. There are significant lobbying efforts in industries other than energy and automobiles, as reported by organisations such as InfluenceMap. 

Last month, carmaker Volkswagen (VW) rejected a shareholder proposal from seven European investors urging it to explain how its lobbying activities help to address climate risks. This gives confidence to other companies that they can actively resist investors’ demands.

This is a question as fundamental as it is challenging. Transparency is paramount, but it is not enough if companies do not demonstrate a willingness to take action by disclosing and rectifying their lobbying efforts, direct and indirect. Some will contend that they do not have full control over the activities of the industry associations they belong to. This is not good enough. As long as industry associations are allowed to lobby against sustainability-related policies, companies will be able to publicly commit to sustainability goals while others pursue their short-term interests.

Lobbying should be seen as an integral part of any sustainability strategy by companies and investors alike. 

It is widely accepted that capital allocation decisions alone, without action by policymakers, are not going to drive the transition to a more sustainable and just economy. 

Investors have the power to drive policy action by demanding that companies lobby in a way that is coherent with the long-term interests of all stakeholders.  

It may seem counterintuitive, but shareholder action is urgently needed to pressure companies to change their approach to lobbying.

Carlo Svaluto Moreolo, Deputy Editor