While more than 80% of the largest U.S. companies have set emissions reduction goals, less than half engaged with lawmakers to advocate for science-based climate policies — and more than 20% have lobbied against them, according to report released Tuesday by sustainability nonprofit Ceres.
“Claiming credit for making operational climate change commitments while undermining the necessary policy measures to achieve those very commitments poses significant reputational and financial risks to companies,” the report’s authors wrote.
Ceres’s analysis comes as climate concerns are playing a larger role in capital markets and shareholder actions. So far this year, companies around the globe have issued $297 billion in green bonds, a 152% increase year-over-year, according to data compiled by Bloomberg. Shareholders also have been increasingly forceful in demanding change, including from fossil fuel titans Exxon Mobil Corp. and Chevron Corp., which were each the target of successful resolutions demanding climate-conscious changes to corporate strategy.
“This is a work in progress,” said Steven Rothstein, managing director of the Ceres Accelerator for Sustainable Capital Markets. “The good thing is companies are highlighting their climate needs. Investors are shouting it from the rooftops in every way they can, and now it has to go deeper.”
Ceres’s report included 96 members of the S&P 100 in 2019, with four companies excluded due to later mergers and other consolidations. The group scored the companies on how they assess, systematize, advocate for, and engage with science-based climate policies in disclosures and documents such as annual filings, as well as on their advocacy and trade group memberships. A science-based climate target is one aligned with the Paris Agreement goal of restricting global warming to below 1.5 degrees Celsius, which will require reaching net-zero emissions worldwide by 2050.
Almost three-quarters of companies in the report describe climate change as a material risk in their regulatory filings, while nearly 90% have tasked their boards with overseeing climate and ESG topics. “What makes me optimistic is that so many companies are recognizing that climate is a crisis and they’re taking bold steps,” Rothstein said.
One lobbying group, the U.S. Chamber of Commerce, came under particular scrutiny from Ceres due to its “oppositional climate change track record,” according to the report. Close to 75% of the companies Ceres analyzed are members of the Chamber, but only one — Apple Inc. — left the lobbying group over its climate stance. Earlier this year, the Chamber reversed its previous stance on climate policy and said it supports a “market-based” approach to reducing emissions, such as a carbon tax or emissions caps.
Rothstein calls these “good initial steps,” but “not enough” to get to net zero.
Matt Letourneau, a spokesperson for the Global Energy Institute at the U.S. Chamber of Commerce, said that the lobbying group is proud of the work it’s doing “to bring meaningful, achievable solutions to the global climate challenge.”
“The business community is at the leading edge of innovation and investment in the technology necessary to reduce emissions, and will be an important voice in the international and domestic policy dialogue,” Letourneau added.
Ceres’s report also comes as Democrats in Congress try to cram many of their domestic priorities, including climate policy, into a budget reconciliation bill they hope to pass later this summer. Rothstein hopes legislators will include funding for projects such as retrofitting homes for energy efficiency and building out electric-vehicle charging networks, he said.
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