Shareholder activists accuse BP of trying to weaken climate transparency

Green investors are urging other shareholders to challenge BP over what they say is an attempt to weaken its climate transparency.

The group of 12 investors, led by Dutch activist group Follow This, have accused the oil major of seeking to cut the amount of climate-related information that it has to share.

Ahead of its annual general meeting (AGM) this month, the company has put forward a proposal to repeal two previous climate resolutions that shareholders backed in 2015 and 2019.

These have since required BP to report detailed climate-related information to investors, such as its management of planet-heating emissions, low-carbon investments, public policy positions, how its strategy and capital expenditure align to UN climate goals and how executive pay is linked to progress.

Follow This said repealing these legacy requirements means BP would no longer have to share the same level of details.

Mark van Baal, founder of Follow This, said: “If BP would be reporting what is in the resolutions, why scrap them?”

He added that losing the requirement to disclose its Paris-aligned strategy would be “the most significant casualty”.

BP argues that industry frameworks have been developed since 2019 and now require firms to share comparable standardised information to investors.

The firm said it has adopted these frameworks for reporting on climate, and so the legacy requirements mean it is often required to share duplicative or overlapping information.

Chairman Albert Manifold told investors that the move would “allow the leadership team to spend more of its time managing the business on your behalf to deliver shareholder value by focusing on mandatory reporting requirements that provide comparable information to investors, instead of provisions that have been largely superseded”.

Elsewhere, the company said its annual report outlined how the board believes its strategy is consistent with the UN Paris Agreement goals, and it also unveiled its net zero strategy in 2020.

A spokesperson for the company said: “Following extensive engagement with our largest investors we are fully focused on building a simpler, stronger and more valuable BP.

“That’s why we are making these recommendations, to provide transparent, standardised disclosures that support clear comparisons across companies.”

However, Follow This said many requirements from the 2015 and 2019 resolutions are not included in current industry reporting frameworks or regulations set to come into force in the near future.

It comes as the latest development in a growing dispute after BP has refused to bring Follow This’s climate resolution to a vote at this month’s AGM.

The activist group said it is now considering legal action against the company.

In an open letter to the board on Thursday, Follow This shared its ongoing concerns over shareholder rights and board accountability.

“Transparent disclosure of how BP would navigate declining demand scenarios is therefore essential not only for assessing company-level resilience, but also for understanding risks to shareholders’ diversified holdings,” it read.