Oil and gas giant BP will face a rebellion at its annual shareholder meeting due to be held on Thursday as some of the UK’s largest pension funds plan to back a climate resolution from activist investor group Follow This.
The National Employment Savings Trust (Nest), which represents approximately 11 million individual workplace pensions, will back a resolution put forward by activist investor group Follow This, the Guardian reports. The resolution calls for BP to better align its emissions reductions targets with the Paris Climate Agreement, which seeks to limit global warming to below 1.5°C.
Follow This has also won support from the Universities Superannuation Scheme and pension fund Border to Coast, with both agreeing to join Nest in backing the resolution in a vote.
Mark van Ball, founder of Follow This, said via the Guardian that BP’s existing plans to reduce emissions do not go far enough because they only rely on reducing the carbon intensity of the energy BP sells. Meanwhile, absolute emissions are expected to keep rising until the end of the decade. This lies out of line with the Paris Agreement, which requires all countries to produce net-zero emissions by 2050.
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Nest’s head of responsible investment Diandra Soobiah told the Guardian that the group wants BP to shift investment more heavily towards renewables. “If BP continues on this path, we have serious concerns about it reaching its net zero goal and the long-term success of the company,” she said.
“While it’s disappointing to see BP rowing back on its climate pledges, what’s particularly worrying is executives haven’t gone back to shareholders and given us a chance to vote on such a significant decision. Actions like this undermine the confidence shareholders have in the board and their corporate governance.”
Norway’s sovereign wealth fund, one of the world’s largest investors and itself built on oil and gas profits, said on Saturday that it will vote against the resolution. It did not give a reason for rejecting the motion, according to Reuters.
The move follows a separate resolution from Follow This put to TotalEnergies earlier this month, also demanding the company do more to cut emissions to align with the Paris agreement. van Ball said at the time that if climate targets are to be maintained, the company “needs to offer renewable energy at scale”.
In another climate rebellion, three pension funds will vote against the re-election of BP’s chairman Helge Lund in protest to the company’s decision to dilute climate pledges this year. In 2019, BP set a target to reduce emissions by 40% by 2030 compared to 2019 levels. In February this was weakened to just 25%, after the company reported record profits from its oil and gas portfolio.