Ethos pushes Holcim to set emission targets for joint ventures

Swiss pension funds-backed Ethos Foundation is demanding construction company Holcim makes further efforts in pursuing climate goals by setting CO₂ emission targets for its joint ventures, and precisely assesses the impact from the use of carbon capture and storage technologies.

Holcim’s joint ventures in 2022 generated over 20m tonnes of CO₂ emissions, said Vincent Kaufmann, chief executive officer of Ethos Foundation, intervening at the company’s annual general meeting (AGM) held today in Zug.

He added that the forecast of capturing 5m tonnes of CO₂ emissions per year until 2030 deploying new technology is unclear, with capture and storage processes requiring, for example, transport, which causes emissions.

“In the next [climate] report Holcim should absolutely specify the complete CO₂ balance resulting from the use of [capture carbon and storage] technologies,” he added.

Holcim, one of the biggest CO₂ emitters in Switzerland, haș made progress this year, particularly in setting new goals to reduce CO₂ emissions aligned with the 1.5°C target set in the Paris Agreement to contain global warming, validated by the Science-Based Target initiative, and publishing, for the first time, estimates for investments of CHF2bn (€2bn) by 2030 for carbon capture, usage and storage (CCUS) technologies.

The company has also published, for the first time, figures on all indirect greenhouse gas emissions (scope 3), linked to its investments and joint ventures which represent 17% of the group’s total emissions.

Ethos therefore recommended the approval this year of Holcim’s climate report, with the expectation that the company will continue its efforts to further improve its climate goals.

It is the second time that Holcim has submitted its strategy for reaching its 2050 net zero emissions target to a consultative vote of its shareholders since Ethos requested it in 2020.

Jan Jenisch, member of the board of directors at Holcim, said at the AGM, in response to Ethos, that the company has had many discussions with the foundation on its climate report in the past few years, a dialogue that has been challenging but constructive.

He added that Holcim is working on a project to re-use CO₂ as raw material.

Remuneration

Ethos considers Holcim’s report on executive management remuneration transparent but ‘compensation’ instances keep increasing. It is therefore requesting Holcim that reviews its remuneration policy.

“The scope for variable compensation should be limited. This applies in particular when a new CEO is named,” Kaufmann said.

Beat Hess, outgoing chair of the board of directors, also underlined that the dialogue with Ethos has been constructive, although with different views. He added that the management of the company will review its compensation system.

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