Activist shareholder group slams $68tn climate initiative for ‘lack of ambition and progress’
Activist shareholder group ShareAction has slammed the world’s largest climate investor initiative today claiming it has “failed to deliver any meaningful progress” on reducing corporate emissions.
The Climate Action 100+ initiative, which is backed by 700 investors representing $68tn in assets, was set up to use investor influence to force action from the world’s largest greenhouse gas emitters.
But as it comes to the end of its first five year cycle, Share Action said the initiative had suffered from a “lack of ambition” and there was “little evidence” it had made any progress.
Isobel Mitchell, lead author of the new report from ShareAction, told City PM the investors that signed the letter had a duty to act.
“These aren’t small investors. These are major fiduciaries who have who are responsible for managing millions of people’s savings and pensions,” she said.
“And if they’re not stepping up to manage the risks posed by the emissions that these companies are spewing out, it’s not good enough.”
ShareAction accused signatories of the initiative of “highlighting their involvement” but rarely reporting details of activities and outcomes.
The Climate Initiative’s tracker shows that less than 12 per cent of the its target companies have adequate short-term emissions reduction targets, while no company has aligned their capital expenditure with a ‘1.5C future’, Share Action claimed.
Mitchell said hat signatories now needed to “commit to meaningful action” as the initiative moved into its next phase.
Climate Action 100+ said today “there is no doubt that there is still urgent work to do” to meet the goals of the Paris Agreement and tackle the climate crisis.
“As Climate Action 100+ moves into the final year of this phase and looks to the future, we intend to further develop and strengthen the initiative to ensure its continued success in addressing the issues at hand,” a spokesperson said.
The criticism from Share Action comes amid growing concerns over corporate ‘greenwashing’ and increased scrutiny from regulators over environmental commitments from top corporates.
The Competition and Markets Authority (CMA) announced from the start of this year it would be taking firmer measures against businesses making “misleading green claims”, while the Financial Conduct Authority has begun forcing big firms to disclose set out their climate impact in annual reports.