BP AGM Photo Opportunity: Shareholders Display Banner
ShareAction is giving media advance notice of its plans to assemble individual shareholders outside BP’s Annual General Meeting on Thursday, April 16 at the ExCel Centre in East London.
ShareAction’s group of individual shareholders will be displaying a colourful banner with a creative design based on BP’s logo, highlighting the risks of climate change to the business and calling on the company to “give climate change a seat at the table”, at 10 a.m. on the steps in Royal Victoria Square, outside the West Entrance of the Excel Centre, nearest the Customs House Docklands Light Railway stop.
The banner is designed to draw attention to the shareholder resolution on climate change about to be discussed inside. ShareAction brought together a coalition of individual shareholders to complement an effort by institutional investors, filing shareholder resolutions at bp and Shell this year, calling on the companies to face up to and disclose more information on the growing business risks associated with climate change.
75% of shareholders are required to vote “yes” on the resolutions to pass them, and a host of big name institutional investors have supported the resolutions over recent weeks, alongside investment managers around the world. bp and Shell have both said they recommend a “yes” vote on the resolutions. ShareAction coordinated delivering the correct signed paperwork for over 140 shareholders by the filing deadlines for each company.
ShareAction chief executive Catherine Howarth said: “For us this is just one aspect of the wider work we undertake to build a movement for responsible investment, which means bringing together diverse groups of players across the investment chain, from individual shareholders to institutional asset owners and asset managers. On an issue as important as climate change, it’s crucial we find ways to cut across the divides that still exist between savers and investment decision-makers. That means it’s important for individual shareholders to voice their support for these resolutions both outside the AGM and inside, by asking questions about the issues they raise.”
Inside the AGM, shareholders will ask questions on the subjects raised by the resolutions.
Jeremy Leggett, a British green-energy entrepreneur, author and activist who is founding director of Solarcentury, founder and Chairman of SolarAid and Chairman of CarbonTracker, will be asking a question about asset portfolio resilience to the International Energy Agency’s (IEA’s) scenarios. He says: “It’s vital that we use the power of the financial system to ensure that companies like BP are doing everything they can to assist us in the transition to a low-carbon future. By asking a question at the company’s AGM I hope to draw all shareholders’ attention to the risks of not properly thinking through a strategy for a carbon constrained world, and I’m delighted to use the power of shareholder democracy to shine a light on these issues.”
Antony Melville, a ShareAction supporter and environmentalist, will be asking about public policy positions of BP. He says: “I’m looking forward to challenging the board on their seemingly inconsistent approach to lobbying on climate change.”
Neil Pitcairn, an environmentalist and co-filer in the resolution, will be asking a question about low carbon energy research and development (R&D) and investment strategies. He says: “As a shareholder in BP I’m pleased to be using my stake in the company to ask a question about such an important issue.”
Notes to editors:
· The full text of the resolution is available here: http://www.bp.com/en/global/
· Broadly speaking, the resolution calls on the company for more openness on:
1. The company’s ongoing operational emissions management
2. The resilience of the company’s asset portfolio to a fuller range of climate change scenarios, including a 2 degree scenario
3. The company’s plans for low-carbon energy research and development and investment strategies
4. The key performance indicators and executive incentives used by the company which are relevant to the low carbon transition
5. The company’s public policy positions relating to climate change
· ShareAction is a UK-based NGO campaigning for responsible investment by pension funds and other institutional investors. ShareAction demands transparency and accountability to the millions of people with savings managed by investment professionals.
· Members of the public can email their pension fund asking them to support the resolutions here: http://secure.shareaction.org/
· For further information please contact Matt Davis at ShareAction on 07564 438 804.
· Probable question text follows (subject to amendments before the AGM).
Operational emissions management, to be asked by Jeannette James, co-filer:
“My question concerns BP’s approach to operational emissions management, with focus on the potential adoption of an external emissions target. I’m pleased to see that BP was successful in reaching a “B” carbon performance band through CDP’s tracking, and that the company is supportive of continuing progress on delivering emissions reductions. Such progress will require a strong, long-term and ambitious approach to emission reductions. The adoption of stretching emission targets and transparent reporting on the company’s advancement towards these goals would contribute meaningfully towards to this. Emission targets have been set by peers in the industry, such as BG Group. A strong target would focus on absolute emissions rather than carbon intensity, and use external agencies such as CDP to help set and monitor standards. Would the board agree to adopt such targets as part of the company’s commitment to continued progress in emission reductions? If not, could the board please explain why BP has chosen not to adopt this practice, despite the fact that it would allow shareholders to make informed decisions with respect the long-term strategy of the company.”
Asset portfolio resilience to the International Energy Agency’s (IEA’s) scenarios, to be asked by Jeremy Leggett, a British green-energy entrepreneur, author and activist who is founding director of Solarcentury, founder and Chairman of SolarAid and Chairman of CarbonTracker:
“My question concerns BP’s portfolio resilience to adverse climate change scenarios. BP claims to take a dynamic approach to its investment strategy and portfolio resistance to changes in policy, market and technology conditions. This is done through assessing numerous variables including the effect of potential carbon polices, changing patterns in supply and demand, fluctuating oil prices and the role of evolving technologies. A blind spot within this analysis is the lack of consideration of the IEA’s 450 scenario. The 450 scenario sets out an energy pathway consistent with the goal of limiting the global increase in temperature to 2°C by limiting concentration of greenhouse gases in the atmosphere to around 450 parts per million of CO2. Without sound and transparent analysis which considers this scenario, it is unclear whether BP’s portfolio would be robust in such a carbon restrained world. There consequently seems a need for the company to stress test business models against this scenario, and share the results openly with investors. Would the board be willing to include a portfolio stress test for the 450 scenario? If this is not something that BP would consider, I would like an explanation as to why not, and what the company’s contingency plans are if forced to adopt a business model based on a two degrees scenario.”
Low carbon energy research and development (R&D) and investment strategies, to be asked by Neil Pitcairn, co-filer in the resolution:
“My question regards low carbon energy research and development (R&D) and investment strategies, with a focus on BP’s disclosure and long-term commitment to these approaches. I was pleased that the board recognised the important role of low carbon technology in addressing the long-term challenges of energy security and climate change, and invested $8.3bn in renewable technologies between 2005 and 2013. However, questions must be raised about BP’s commitment to this strategy, particularly given the lack of targets set for further investment and the decision to divest from or disband all alternative energies businesses, with the exception of Brazilian biofuels and US wind. A lack of disclosure surrounding the company’s low carbon investment and development strategy makes it harder to assess BP’s strategy and level of commitment to low carbon technology advancement. Therefore, could the board please provide detail on BP’s post-2015 approach to low carbon development and investment? I am particularly interested in the company’s plans to increase the proportion of R&D investment in low carbon ventures in comparison to fossil fuel explorations.”
Relevant strategic key performance indicators (KPIs) and executive incentives, to be asked by Steph Eldridge, ShareAction supporter:
“My question concerns BP’s strategic key performance indicators (KPIs) and executive incentives, with a focus on how these are being structured to reduce greenhouse gas emissions, and lessen emphasis on Reserve Replacement Ratio. It is positive to see that BP offers disclosure on strategic KPIs and executive incentives, as found in the Annual Report and Form 20-F.These reveal that KPIs and incentives are currently in place on the issues of greenhouse gas emissions, safety and operational risk and reserve replacement ratios. However, to assess board level commitment to BP’s transition to a low carbon economy, it seems necessary to understand the strategic role that these incentives play. In the future, incentives will need to reflect a corporate transformation or managed decline strategy. Performance targets need to incorporate a greater emphasis on safety and the environment and include a lesser importance on elements that are inconsistent with low carbon transition such as Reserve Replacement. Would the board consider incorporating these points into the structuring of incentives and KPIs, and offer disclosure on how these are being evolved?”
Public policy positions, to be asked by Antony Melville, ShareAction supporter:
“I have a question concerning BP’s approach to corporate lobbying, focussing on the company’s public policy position on key climate change political decisions. These matters are of particular concern in the critical 2015- 2020 period. I applaud your decision to leave the controversial lobbying group ALEC, whose stance on climate change seems deeply divergent to the more progressive position that BP adopts in the 2014 Sustainability Report. I hope that other major energy companies will follow on your lead on this judgement. However, it seems that BP’s public policy position on climate change is not consistent across the board. The company – and certain high-level members within it – continue to fund individuals and groups that have lobbied against progressive policies on climate change. This was recently highlighted when it emerged that funds were paid to climate change deniers in US, such as Senator James Inhofe. Further inconsistency is seen in BP’s continued membership of EU lobbying groups such as BusinessEurope, CEFIC, FuelsEurope and OPG. A recent report from the PSI shows that these groups have adopted lobbying positions on climate change in the EU that would seem to fly against the positive statements appearing in your Sustainability Report. This discrepancy in policy positions on climate change makes the need for greater strategic consideration and disclosure on BP’s public policy programme essential. Could the board please clarify whether you support the lobbying position of the European trade associations and US politicians who attempt to inhibit progressive policies on climate change? If not, is the board willing to make a public statement distancing BP from these lobbyists, or indeed would you withdraw your membership from these organisations as you did with ALEC, and end the financing of climate change sceptics?”
Director of Communications and Public Engagement