BP investors yesterday overwhelmingly backed a shareholder resolution calling for the oil and gas major to describe how its strategy is consistent with the goals of the Paris Agreement on climate change.
More than 99% of votes cast were in favour of the resolution, which was initiated by investors acting as part of the engagement initiative Climate Action 100+.
The resolution was expected to pass. Co-filed by nearly 60 institutions owning 10% of BP’s voting shares between them, including six of the UK’s 10 largest fund managers, it was also backed by BP itself.
Stephanie Pfeifer, CEO of the Institutional Investors Group on Climate Change (IIGCC), said the ultimate level of support for the resolution at the AGM “sends a clear message that investors expect companies to act on climate change”.
“With the resolution passed, BP is now legally bound to set out a strategy to ensure it is aligned with the goals of the Paris Agreement,” she added. “The company believe they already meet this objective, so it’s now down to them to show this is the case.”
According to Bruce Duguid, head of stewardship at Hermes EOS, which jointly led the IIGCC/Climate Action 100+ engagement group on BP, the resolution was “carefully designed to have the high ambition of a strategy consistent with the goals of the Paris Agreement, combined with robust reporting requirements by which to demonstrate this, while leaving flexibility for the company to set the precise strategy”.
Scope 3 ‘heroes’
Investors were also asked to vote on another shareholder resolution at the BP AGM, co-ordinated by Dutch campaign group Follow This.
It called on BP to include within its targets emissions from the use of its energy products, which are known as Scope 3 emissions. The resolution was not backed by the company and received 8.35% of the vote; 6% of voting shareholders abstained.
Follow This’s Mark van Baal said 8% was impressive for an NGO resolution, and noted that the resolution received more backing than when the equivalent resolution was first tabled at Royal Dutch Shell. Shell is the only oil and gas major to have set targets for Scope 3 emissions.
Jeanne Martin, senior campaigns officer at pressure group ShareAction, said: “There’s clearly appetite for BP to set emissions reduction targets for its clients’ products, with some of BP’s largest investors already announcing that they would call for this if BP failed to deliver a Paris-consistent strategy in a year’s time.”
Van Baal said the institutional investors that voted for the Follow This resolution were “climate heroes”.