2015 was a big year for shareholder activism against oil and gas companies. Less than a month in, 2016 is looking like it will be even bigger. And methane is the next target.
This is according to news from Bloomberg, which reported that 21 American oil and gas companies have already faced shareholder regulations on environmental and social policies this year.
We all know about consumer action against companies and how effective it can be. Shareholder activism is another tool for persuading companies to be good. So is recognizing that, as shareholders, we actually hold power over a company and can influence its actions directly. Most major oil and gas companies in the U.S. are publicly traded and thus subject to the rules and regulations that govern such companies, and are directly accountable to shareholders.
In fact, this is a recent shift for environmental advocates who, traditionally, confronted corporations from the outside or relied on government enforcement. In 2001, there were only six shareholder resolutions related to climate, according to Ceres. Last year, there were 167.
In one of the biggest last year, a majority of BP shareholders voted for a resolution on climate change at their annual meeting. Other successes include getting commodities giant ADM to commit to a deforestation policy and pressing Starbucks to follow through on its recycling commitments.
There are networks today that directly work with investors to empower them to push for change within companies. One such network is The Shareholder Activist, which, according to its website, gives investors the “tools, tactics and techniques to more fully exercise your rights as an equity stakeholder of a publicly traded corporation.”
This year, activist investors are targeting methane emissions. Methane is a greenhouse gas that is estimated to be 84 times more potent than carbon dioxide, and much of it comes from oil and gas drilling operations, including fracking. Reducing methane in the atmosphere would make a big difference in greenhouse warming in the short term, and it is a key part of President Barack Obama’s climate plans.
According to an Environmental Defense Fund report released last year, “The 20-year climate impact of methane escaping from oil and gas operations worldwide is equal to the carbon dioxide emissions from 40 percent of total global coal combustion.” This is huge.
Moreover, the impacts will only increase if we follow business as usual. Without action, EDF estimated that methane emissions will increase 23 percent by 2030, more than CO2 emissions as projected by the International Energy Agency.
“Unless methane emissions from oil and natural gas systems are taken into account, the overall greenhouse gas benefits of natural gas will be overestimated,” said Kate Larsen, the report’s lead author, in a press statement.
Expect to hear more news at shareholder meetings across the country as the campaign to reduce methane emissions ramps up. With the Paris Agreement signed, there’s no better time than now.
Image credit: Katrina Tuliao via Wikimedia