The good words and noble intentions of many companies on climate change action are at odds with their own lobbying and association memberships. Will behind-the-scenes manoeuvring blow the chance for COP21 success?
Lobbying is never likely to go away. The practice of trying to influence public policy and law to satisfy narrow private interests is as old as democratic government itself. There’s a tale that US President Ulysses S Grant (1869-77) used to smoke and drink in the Washington DC Willard Hotel lobby and coined the term lobbyist to describe all the petitioners who came to curry his favour. But “lobby” was a verb used even further back, describing the antechambers of the UK Parliament and the US Congress where constituents could interact with representatives.
These days lobbying isn’t just a practice, it’s a growth industry. Lobbying in its strictest sense – being heard by and influencing lawmakers – is protected as a legal right in the US (free speech protected by the First Amendment) and EU (through the Treaty of Lisbon’s legal framework for “interest representation”.)
Yet the types of activities that lobbying entails and the influence it wields have grown to alarming proportions, especially in the area of climate change. “Energy companies relying on fossil fuels aggressively lobby against climate change legislation they perceive as threatening their corporate interests,” says Thomas Holyoke, a professor at California State University at Fresno and author of The Ethical Lobbyist. “This is hardly unexpected, since meaningful climate change legislation has to be detrimental [to them].”
The problem is that as the economic might of companies has grown their influence vastly overshadows the influence of people, groups and associations lobbying for the public good or interests. As researcher Lee Drutman has reported, for every one dollar spent on lobbying by labour unions and public-interest groups together, large corporations and their associations spend $34. And of the 100 organisations that spend the most money on lobbying, 95 consistently represent business.
Both Holyoke and Drutman have endeavoured not to vilify the profession of lobbying. However, they have found that lobbyists are frequently more loyal to their connections in government than they are to the clients paying them, and that lobbying tends to create ever more opportunities to lobby.
Lobbying blossomed from the 1970s, both in the US and in the EU. By about a decade later when the climate change issue had inched into people’s consciousness and onto government agendas, lobbying firms and business associations had learned how to subtly and not-so-subtly influence and shape the making of policies and laws.
Lobbying’s success, however, has turned into sustainability’s ultimate roadblock – a study in 2013 by responsible business consultancy Vigeo found that most companies’ lobbying practices are not aligned with their sustainability principles. This is especially critical as the world grapples with the ultimate sustainability challenge – keeping our climate within the widely agreed boundary of two degrees of warming.
Oiling the doubt machine
ExxonMobil’s knowledge of climate change science and its subsequent funding of climate change denial and lobbying against climate change action is the most egregious example of how lobbying can delay progress in climate action. In a case now being hashed through in the global press, ExxonMobil had done internal cutting-edge research on the presence and effects of climate change before the issue was high on the public’s radar. Yet it went on to spend $30m over 30 years on anti-climate-change thinktanks and research, according to a Greenpeace tally.
Earlier this year ExxonMobil told the Guardian that the company “does not fund climate denial”, yet since 2007 it has expended $1.87m to finance the campaigns of climate-denying Republicans in the US Congress. In fact, an October 2015 report from the London-based advocacy group Influence Map found that oil and gas companies (those studied were Shell, BP, Total, ExxonMobil and Chevron) are systematically obstructing climate change legislation and carbon pricing directly and through their involvement in trade associations.
“Until civil society’s complete regulatory process on climate becomes objective and independent of the energy companies (just as smoking legislation should not be written by tobacco companies) we will make slow progress,” says Dylan Tanner, executive director of Influence Map.
While most large companies can be said by Influence Map’s analysis to be “misaligned” – in other words, their words around climate change action rarely match their policies and their actual deeds – there is a growing movement among progressive businesses to find common ground and common cause in addressing climate change and forging a cleaner energy future.
As we approach December’s COP21 negotiations, it is worthwhile to ask whether the forces lobbying for climate change action are stronger than those lobbying against climate action.
Coal is the canary
The coal industry and its lobbying efforts are a potent cautionary tale. It has been a terrible year economically for the coal industry, with bankruptcies, company losses, capital flight, plunging US coal production and exports, and a forecast for an even more dismal future.
The coal industry would seem to be fighting for its life. But while it might behove the industry to figure out how to adapt business models to a world eschewing coal, the opposite is happening. The coal industry is imploding, yet it is still spending lots of discretionary cash on lobbying.
“Coal is in free fall,” says Nick Abraham, editor of Oil Check Northwest, an energy industry watchdog in Portland, Oregon. “They know they are dying, they don’t know how to fight the PR battle in any new way, they don’t have the money to donate the way they used to, yet they are throwing everything they have left at the [climate change] battle, though their political capital is waning.”
And when coal companies do go bankrupt, as Alpha Natural Resources did this year, disclosures have demonstrated a paper trail of their funding of groups fighting climate change legislation. Abraham says he finds it amazing that though companies in the oil industry “are not dumb about what has happened to coal”, they continue to lobby against meaningful climate legislation. Financial institutions are looking at their carbon asset risks and companies such as ConocoPhilips say they are taking stock of that risk. Yet a March 2015 research study funded by the Tellus Mater Foundation found many companies still prominently working against legislation, especially through trade associations.
“I have had the opportunity to talk to reps and heads of sustainability at Chevron, Tesoro and ConocoPhilips,” Abraham said. “They all seem to see the writing on the wall; energy projections that show in the next decades we'll eventually only derive about 20% of our energy from oil. They all know the pie is going to shrink but they all think they have the right plan to corner that smaller pie.”
Influence Map, as well as analysing the oil industry’s obstruction of climate regulations, has ranked the globe’s top 100 corporations – those at the top are the most progressive in their support of climate change policy, while those at the bottom are most obstructive. Not surprisingly, oil companies get Fs and Es with the occasional D (Royal Dutch Shell) while the top scorers – Google and Unilever – squeaked in with solid Bs.
(Source: Influence Map; full ranking here)
“To get an A,” says Influence Map’s Dylan Tanner, “a company would have to show positive engagement on all policy queries across all data sources.” It would also have to show that its own positions and those of the trade associations it is a member of are in alignment. That’s no easy feat. Unilever, for example, quit industry group BusinessEurope in 2014 reportedly because of the trade association’s lobbying against environmental and climate change legislation. Unilever hasn’t left CEFIC, the European Chemical Industry Council, though CEFIC has been previously accused of lobbying extensively against the European Emissions Trading Scheme.
Thomas Lingard, climate advocacy and sustainability strategy director at Unilever, says the issue of companies’ connections with trade associations is a thorny one. “If you are a progressive company and find yourself in an association with a range of views, do you stay engaged and try to improve the consensus position, or do you opt out completely, and risk that the group's position is dragged down by less-forward-thinking companies? That’s quite a difficult position to be in.”
CEFIC in particular may be modulating its climate legislation stance – at the Business & Climate Summit in Paris in May the organisation was a partner in that meeting’s “conclusive messages” including calling for an ambitious agreement at COP21, carbon pricing and the elimination of fossil fuel subsidies, and international rules that encourage climate action and investment in low-carbon innovation and assets.
Lingard says that for Unilever, a consumer goods business, it is easier to align a progressive vision for the transition to a low-carbon economy with its actions for economic sustainability. “The transition doesn’t pose an existential threat to us,” he says.
Among Unilever’s many climate pledges are zero net deforestation by 2020 associated with its use of palm oil, soy, paper, and beef; CO2 emissions at or below 2008 levels by 2020; and 100% renewables usage globally by 2020.
Still, the need for transparency and accountability on climate commitments has led Unilever to do some housekeeping around its trade industry associations.
“Where we have put some process in place is around managing the due diligence – making sure that as a company we’re not doing anything unintentional that could be construed as going in the wrong direction,” Lingard says. Part of that due diligence includes “checking in” with executives globally that might be on the boards of trade associations to make sure that “what [the trade associations] are saying is aligned with Unilever’s own relatively progressive point of view,” Lingard explains.
Jonathan Jacoby, special adviser for private sector engagement to the executive director of Oxfam International, says that as we approach the COP21 meetings in Paris he sees a familiar dynamic playing out as the one he saw back in 2009 around the Copenhagen COP15 summit as well as attempts to pass climate change legislation in the US (with the Waxman-Markey bill and its Senate counterpart.”
“It’s a tale of two business communities playing out in real time,” Jacoby says. On one side, powerful groups including the US Chamber of Commerce and the National Association of Manufacturers (NAM) did oppose and continue to oppose climate change action. On the other side Ceres, the sustainability advocacy group, has managed through its Bicep project (Business for Innovative Climate and Energy Policy) (formed in 2008) to encourage a powerful group of progressive companies to voice support for global action.
What’s different in 2015, Jacoby says, is that several industry sectors – food and beverages, agriculture, and finance – are now “lined up” for climate action. [see box]
Bicep (Business for Innovative Climate and Energy Policy), a project launched by sustainability advocacy group Ceres in 2008 with just five companies (Nike, Starbucks, Timberland, Levi Strauss & Co and Sun Micro Systems), is now one of the biggest coalitions of companies pushing for climate legislation. The 34 companies that have joined Bicep are saying they support success in Paris and are “mobilizing for leadership and action on climate change challenges and goals”. Food and drink companies make up around a third of Bicep’s membership – cereals maker Kellogg’s is one of the latest to join the group. Clothing companies such as Patagonia and Gap are also a prominent slice of the group’s membership.
“The good news is you have a critical mass of companies and sectors and industries, lining up publicly and vocally for robust climate action because they see the business case,” Jacoby says. “The bad news is it remains to be seen whether they’ll invest enough political capital to be public champions.”
Once the business case is envisioned, there’s a fairly clear road to take, Jacoby says. “Oxfam would say speak up, and do it transparently, not behind closed doors,” he says. “Be accountable, let others know what your positions are, let your investors and the media know. And then, act responsibly to put your public policy positions and your own company policies in line with the science.”
Thus far, companies’ understanding of the business case hasn’t seeped far enough into their strategic planning and activities to stem their anti-climate lobbying. US Senator Sheldon Whitehouse, reacting to the news that 81 companies had announced new climate goals in October, said in a statement that the “massive” corporate lobbying in America is still “at best silent on climate change, and at worst adamantly hostile”. Whitehouse echoed the conclusions of analysts at Influence Map when saying: “The only way the tide will turn is through alignment of policy with advocacy.”
Unilever’s Lingard says we are seeing the tide turning right now. “The news is coming so thick and fast,” he says. “And when you are talking about a system shift this massive, nobody’s kidding themselves that it’s going to happen only through voluntary action. I think you can even sense a shift happening in the trade associations – they too are having to decide whether they want to be on the right side of history.”
But in spite of their good words, some companies continue to play the both sides of the issue, and while more of their words can been seen as aligning behind climate change legislation and strong commitments in Paris, time will tell whether their actions, and particularly the actions that they are not yet transparent about, are lining up as well.lobbying climate change fossil fuels energy companies ExxonMobil Vigeo Greenpeace
April 2016, New York
Through interactive workshops, roundtables and case studies senior executives from the likes of; Timberland, Interface, Citi, Adobe, Campbell’s will provide practical insights on the current issues faced in sustainability.