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In 2017, mining companies BHP and Rio Tinto were asked by investors to address the regressive climate lobbying activities of their powerful industry groups. New analysis from InfluenceMap shows the companies have since made little progress to ensure such lobbying activities align with their own statements of support for climate ambition
The analysis is based on InfluenceMap's methodology, which benchmarks against the expectations of investors on the issue as communicated by representatives, the UN PRI, IIGCC, and CERES. It looks in detail at the most recent disclosures from BHP and Rio Tinto on governance of industry group lobbying (BHP’s 2019 disclosure and Rio Tinto’s 2020 disclosure respectively).
To gauge actual performance on the issue, InfluenceMap continually assesses over 100 industry groups globally, including all the major industry groups funded by BHP and Rio Tinto. InfluenceMap's analysis finds no material improvement over the last three years in the climate lobbying practices of key industry groups funded by the two mining giants.
BHP and Rio Tinto's corporate disclosures and reviews of their lobbying groups appear to focus on nominally positive, top-line climate statements from groups like the US Chamber of Commerce or the Minerals Council of Australia (MCA). At the same time, BHP and Rio Tinto appear to have ignored or not identified substantial evidence of detailed and ongoing lobbying activities from these groups that runs counter to Paris aligned climate policy.
Rio Tinto and BHP have been under increasing shareholder pressure, including resolutions, on climate lobbying by their powerful industry groups. This trend has since spread to many other fossil fuel and carbon-intensive sectors against the backdrop of stalled or rolled back climate policy in regions where these industry groups operate, particularly Australia and the United States.
Investor concern on this lobbying has coalesced as a central pillar of the Climate Action 100+, an engagement process made up of 450 investors who collectively manage over $40 trillion in assets. This has triggered almost 15 additional global corporates to undertake or commit to similar disclosures, including global energy giants Royal Dutch Shell and Glencore.
This analysis highlights a trend whereby companies and industry groups are engaging with investors and the media by focusing attention on top-line positive statements on climate while distracting stakeholders from the important details that conversely show patterns of opposition to science-based climate policy. With few effective binding disclosure requirements on companies, fact-checking mechanisms like those deployed by InfluenceMap will likely be essential to drive real corporate governance improvement in this area.