New comparative analysis of the US transportation sector reveals inconsistency between climate goals and policy advocacy

An emerging trend points to increased accountability in several carbon-intensive industries

NORTHAMPTON, MA / ACCESSWIRE / May 23, 2024 / A new comparative analysis of 15 major U.S. auto companies reveals inconsistencies between companies’ public climate commitments and their direct and indirect lobbying practices. This contradiction poses significant risks to their market position as the global transition to zero emission vehicles (ZEVs) accelerates, especially with countries like China leading the way.

Rating, Driving change: assessing automotive companies’ climate policy support, finds that while these companies are deeply committed to engaging in climate policy and are taking steps to meet their climate commitments by advocating for some climate policies, almost a quarter of the automotive companies assessed have not demonstrated commitment to Paris-aligned climate policies . At the same time, they and their industry associations have engaged in practices that actively undermine policies that are crucial to the transition to clean transportation and that they have pledged to support.

The good news is that some companies in this and other carbon-intensive sectors are starting to take significant steps to hold their industry associations accountable, while more and more investors are holding companies accountable. The analysis points to Ford’s decision to leave the Truck and Engine Manufacturers Association over its lobbying against a proposed Environmental Protection Agency rule aimed at reducing greenhouse gas emissions from heavy trucks. General Motors disclosed that it is taking steps to influence the position of lobbying groups including the Alliance for Automotive Innovation and the National Association of Manufacturers on policies such as the Inflation Control Act. ?

“Our analysis highlights the need for significant improvements across the transportation sector to consistently support policies that accelerate the adoption of clean vehicles in the U.S. and reduce tailpipe emissions.” said Michael Kodransky, senior director of transportation at Ceres. “For example, over the past three years, most of the 15 companies analyzed lobbied against state and federal vehicle emissions regulations that would spur market growth and reduce climate pollution. Automakers should not only support this legislation, but also leverage incentives from other policies, including the Inflation Control Act and the Infrastructure Investment and Jobs Act, to unlock investment and demand for clean cars and trucks.”

The Ceres analysis makes several recommendations for responsible political engagement, including:

• Directly advocate for policies that help achieve climate pollution reduction goals.
• Continue indirect action through membership in industry associations that align with the organization’s climate goals.
• Minimize inconsistencies in climate change propagation across regions.

This is the third sector analysis of responsible political engagement practices published by Ceres, following analyzes of the banking and utilities sectors. Responsible policy engagement in line with climate science is a fundamental expectation of the Ceres Ambition 2030 initiative, which aims to decarbonize the most emitting industries – energy, banking, food, agriculture, oil and gas, steel and transport. These sectors account for approximately 80% of total U.S. emissions.

“Ceres’ analysis of the automotive industry highlights inconsistent corporate action on climate through direct lobbying and industry associations, why this is problematic, and identifies best practices that automotive companies can employ in the future,” she said Dominic Gogol, deputy policy director of the We Mean Business coalition. “As the nation’s largest source of emissions, automakers play a key role in transitioning the U.S. economy from fossil fuels to green solutions. They can more effectively exert influence to ensure the adoption and implementation of clean, efficient transportation policies that will help build more prosperous economies and resilient communities.”

Since Ceres began calling on companies to evaluate their lobbying practices in 2016, following two benchmarking studies of S&P 100 companies, more companies have made progress in aligning their lobbying practices with climate goals. Dominion Energy has acknowledged that their industry associations have historically opposed climate policies, while fellow utility Eversource left the American Gas Association as part of efforts to prioritize decarbonization. In March, media reported that at least 37 corporate members of the U.S. House expressed concerns about the House’s position on climate policy, citing conflict with their own climate goals.

Moreover, supporting a climate policy aligned with the Paris Agreement is a top priority for investors who aim to reduce portfolio risk from climate change and maximize the opportunities presented by the energy transition. Just last month, 38.4% of Bank of New York Mellon shareholders voted for the company to disclose its direct and indirect lobbying. Ahead of this year’s replacement season, a similar venture at Stride had 49.5% shareholder support.

“Faced with such a significant threat of increased foreign competition as the U.S. market transitions toward a clean economy, all companies in every sector must follow the lead of companies that hold their lobbyists accountable,” she said. Steven Rothstein, managing director of the Ceres Accelerator for Sustainable Capital Markets at Ceres. “Failure to act now will not only jeopardize their market position, but also the future of our economy and planet.”

About the Ceres Accelerator for Sustainable Capital Markets

Ceres is a not-for-profit organization dedicated to accelerating the transition to a cleaner, more just and sustainable world. The Ceres Accelerator for Sustainable Capital Markets aims to transform the practices and policies that govern capital markets by engaging federal and state regulators, financial institutions, investors and corporate boards to address climate change as a systemic financial risk. For more information, visit ceres.org AND ceres.org/accelerator.

Contact with the media: Diane May, [email protected], 617-247-0700 ext. 220

View additional media and more ESG stories from Ceres at 3blmedia.com.

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SOURCE: Ceres

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