- The heads of 13 large global companies launched the CEO Climate Dialogue in May to lobby Washington, DC, for market-based climate legislation.
- “Market-based” here refers to policies like a carbon tax or cap and trade.
- Many of these companies have long lobbied for non-environmentally-friendly policies, but now want to influence inevitable climate policies while they still have the chance.
- This article is part of our ongoing series on Better Capitalism.
- Visit Business Insider’s homepage for more stories.
President Donald Trump has built an administration opposed to any significant action toward addressing man-made climate change, from repealing regulations for coal companies to withdrawing from the Paris Agreement. But now CEOs from some of the companies he’s trying to benefit are asking for climate legislation.
The heads of 13 large international companies and four environmental nonprofits announced the CEO Climate Dialogue in May, with the intent of lobbying “the President and Congress to enact a market-based approach to climate change.”
Gretchen Watkins, president of Shell, stated in the group’s press release that “an effective carbon pricing policy, based on the guiding principles outlined by The CEO Climate Dialogue is one of the strongest levers we can pull to foster innovation, inspire new technology and drive lower carbon consumer choices.”
The group has not formed an actual organisation, but is rather agreeing to push for a set of shared principles, with the idea that if its members can steer the conversation around laws they’re comfortable with, then they won’t have to radically adjust to harsher regulations that would inevitably be passed in the not-too-distant future.
The CEO Climate Dialogue includes the chief executives of BASF Corporation (chemicals), BP (oil and gas), Citi (banking), Dominion Energy (electricity and gas), Dow (chemicals), DTE Energy (electricity and gas), DuPont (chemicals), Exelon (electricity, gas, and nuclear energy), Ford (automobiles), LafargeHolcim (building materials), PG&E (electricity and gas), Shell (oil and gas), and Unilever (consumer goods).
They’re collaborating with the Center for Climate and Energy Solutions, the Environmental Defence Fund, The Nature Conservancy, and the World Resources Institute, and are using the Meridian Institute nonprofit to work on their lobbying approach.
The group has agreed to these six principles:
- Reduce US greenhouse gas emissions by at least 80% by 2050.
- Policies must consider the economic stability of the industries involved and focus on specific outcomes rather than specific technologies.
- The solutions must be market-based, meaning that they could entail policies like a carbon tax or a cap-and-trade credit system.
- The policies will be adaptable over time.
- The solutions must protect the environment without harming the competitiveness of the US economy.
- The policies must be transparent and benefit American workers and communities that have the least resources to adapt.
The 13 corporations are no strangers in DC. Open Secrets found that they together spent $US55.8 million on lobbying last year. And there’s reason to be sceptical: InfluenceMap researchers found that the five largest oil and gas companies, which includes BP and Shell, last year spent $US400 million on climate-related lobbying/branding and $US960 million on non-climate-related lobbying/branding. This year, they’re projected to spend $US110.4 billion on their oil and gas businesses and just $US3.6 billion in low-carbon investments. There is also years of examples of these companies and others “greenwashing,” where publicized climate-friendly messaging hides far more significant action toward supporting contradictory policies.
But over just the last couple years, as the Trump administration has pushed further away from recognising humans’ effects on climate and the scientific consensus that the current way of doing business is leading to a destabilized future, momentum is building in the opposite direction.
Investor groups like Climate Action 100+ (which is made up of 338 institutional investors led by CalPERS that oversees a total of $US30 trillion in assets under management) have been pushing the world’s largest greenhouse-gas emitters to adapt their strategies to the goals of the Paris Agreement of 2015. It’s so far had success with companies like BP and Shell.
Mindy Lubber is the CEO of the nonprofit Ceres and a board member of Climate Action 100+, and she told Business Insider that they have been working on getting businesses to see that reducing their emissions is necessary for their long-term success. As the US government’s Fourth National Climate Assessment found late last year, the US economy will shrink by 10% (a massive number) by the end of the century if the current pace of climate change continues. Lubber is motivated by urgency, but is willing to see corporations take small steps to kick things off. “For some of these companies, we’re asking them to radically change what they do,” she said.