Occidental loses bid to throw out green investor resolution

US regulators will pressure Occidental Petroleum to carry a shareholder vote on tighter emissions targets, rejecting a petition by an organization that has touted its local weather objectives as among the many most bold within the oil and fuel sector.

Occidental had requested the Securities and Alternate Fee to throw out a movement calling for it to set brief, medium and long-term emissions objectives according to the 2015 Paris Settlement to restrict international warming.

The corporate argued it had “considerably carried out” the proposal via targets already in place. However the SEC rejected this.

“Primarily based on the data you have got introduced, it seems that the corporate’s public disclosures don’t considerably implement the proposal,” the SEC wrote in a letter seen by the FT dated March 15.

Texas-based Occidental has positioned itself as an trade chief on local weather. It has set targets to cut back carbon emissions from its operations and suppliers to web zero by 2040, and attain web zero for so-called scope 3 emissions from clients burning its merchandise by 2050. It’s the solely huge US oil and fuel producer to have set a scope 3 goal.

The corporate is closely concerned in carbon seize, utilisation and storage, a enterprise it plans to develop within the coming years. Chief government Vicki Hollub advised the FT final 12 months the corporate’s carbon sequestration efforts have been equal to taking about 4mn automobiles off the street yearly.

However critics argue Occidental has not gone far sufficient and that the targets are too obscure. The corporate is among the greatest oil producers within the US, pumping 1.2mn barrels of oil equal a day final 12 months.

Comply with This, a Netherlands-based activist group with stakes in oil producers in Europe and the US, filed the movement. The campaigners additionally submitted related motions with ExxonMobil, Chevron, ConocoPhilips and Phillips 66, which didn’t contest them.

“It’s telling that the SEC principally states that even Occidental — which has some targets — isn’t Paris constant,” stated Mark van Baal, founding father of Comply with This. “I hope the buyers realise that these firms received’t change of their very own accord — that they should vote.”

Responding to the choice, Occidental stated the corporate had established “a strong set of greenhouse fuel targets to advance our main web zero objectives, and we have now additionally endorsed a number of different initiatives that embrace further local weather commitments”.

“We look ahead to continued engagement with Comply with This and different shareholders on our web zero technique,” the corporate added.

The SEC has taken a more durable line on local weather change since Joe Biden turned president, making it simpler for shareholders to suggest environmental resolutions. Below the Trump administration the regulator was extra prepared to permit firms to throw out climate-related motions on the premise that they constituted “micromanagement” or had been “considerably carried out”.

The company on Monday is anticipated to unveil an unprecedented proposal to require firms to reveal extra about carbon emissions. Oil trade lobbyists on the American Petroleum Institute, which incorporates Occidental, have written to the SEC to lift issues with the rulemaking.

Further reporting by Patrick Temple-West in New York