While we should all do our part to reduce pollution and greenhouse gas emissions, a recent study reported in the Guardian finds that such efforts will frankly be worthless so long as a handful of powerful private entities account for the vast majority of climate change-causing pollution.
The Carbon Majors Report (pdf) “pinpoints how a relatively small set of fossil fuel producers may hold the key to systemic change on carbon emissions,” says Pedro Faria, technical director at environmental non-profit CDP, which published the report in collaboration with the Climate Accountability Institute.
Traditionally, large scale greenhouse gas emissions data is collected at a national level but this report focuses on fossil fuel producers. Compiled from a database of publicly available emissions figures, it is intended as the first in a series of publications to highlight the role companies and their investors could play in tackling climate change.
The report found that more than half of global industrial emissions since 1988 – the year the Intergovernmental Panel on Climate Change was established – can be traced to just 25 corporate and state-owned entities. The scale of historical emissions associated with these fossil fuel producers is large enough to have contributed significantly to climate change, according to the report.
ExxonMobil, Shell, BP and Chevron are identified as among the highest emitting investor-owned companies since 1988. If fossil fuels continue to be extracted at the same rate over the next 28 years as they were between 1988 and 2017, says the report, global average temperatures would be on course to rise by 4C by the end of the century. This is likely to have catastrophic consequences including substantial species extinction and global food scarcity risks.
This puts addressing climate change square in the hands of executives, investors, and shareholders–the narrow class of individuals less likely to be impacted by climate change, best equipped to adapt to it, and most likely to be wrapped up in short-term gains ahead of long-term consequences.
Investors should move out of fossil fuels, says Michael Brune, executive director of US environmental organisation the Sierra Club. “Not only is it morally risky, it’s economically risky. The world is moving away from fossil fuels towards clean energy and is doing so at an accelerated pace. Those left holding investments in fossil fuel companies will find their investments becoming more and more risky over time.”
There is a “growing wave of companies that are acting in the opposite manner to the companies in this report,” says Brune. Nearly 100 companies including Apple, Facebook, Google and Ikea have committed to 100% renewable power under the RE100 initiative. Volvo recently announced that all its cars would be electric or hybrid from 2019.
And oil and gas companies are also embarking on green investments. Shell set up a renewables arm in 2015 with a $1.7bn investment attached and a spokesperson for Chevron says it’s “committed to managing its [greenhouse gas] emissions” and is investing in two of the world’s largest carbon dioxide injection projects to capture and store carbon. A BP spokesperson says its “determined to be part of the solution” for climate change and is “investing in renewables and low-carbon innovation.” And ExxonMobil, which has faced heavy criticism for its environmental record, has been exploring carbon capture and storage.
But for many the sums involved and pace of change are nowhere near enough. A research paper published last year by Paul Stevens, an academic at think tank Chatham House, said international oil companies were no longer fit for purpose and warned these multinationals that they faced a “nasty, brutish and short” end within the next 10 years if they did not completely change their business models.
It is also worth pointing out that while a large number of the corporate culprits are based in the West, overall they span most of the world: rich and poor, developed and developing, democratic and autocratic:
Most of these companies are not household names, which reflects the low-key nature of the global energy industry: many of us in the developed world take for granted the seemingly endless supply of electricity, gasoline, and other energy supplies. The extraction, production, refinement, and delivery of these fossil fuels occurs unseen, involving a complex network of companies dispersed around the globe.
Thus, as with so many other solutions to climate change, there will need to be a comprehensive, globally coordinated effort by the international community to reign in on pollution and environmental degradation, in cooperation with–or even in opposition to–some of the most powerful corporate interests in the world.
Is there any possibility that the global masses can apply pressure their governments (and to a lesser degree their businesses) to take action? Are these individuals and institutions too wealthy and far removed from the public to be influenced and accountable to either governments or their constituents? What are your thoughts?