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25/09/2016

Business and the struggle between climate and profit

Sustainable Dev.

Business and the struggle between climate and profit

Many companies are members of interest groups that lobby against conservation efforts.

[Greenland Travel/Flickr]

Business lobby groups use their influence to hold back EU legislation on climate change. The authors of a recent study believe this should force companies to reconsider their priorities. EurActiv France reports

Despite claiming to be engaged in the fight against climate change, many European companies have poured their resources into lobby groups which actively oppose legislation aimed at mitigating climate change.

The University of Westminster’s Policy Studies Institute examined this paradox in a report published on 30 March.

77% of the world’s 500 biggest companies are members of lobby groups with an interest in climate change. Many of these organisations, which include the fossil fuel lobbies, energy intensive industries and groups like BusinessEurope and Medef, work to undermine the European carbon market and weaken energy efficiency measures and support for renewables.

In a press release from February this year, BusinessEurope declared its opposition to EU plans to reinvigorate the carbon market by “back-loading” the auction of quotas. They called instead for “a much more balanced”, and much slower, approach to carbon market reform.

BASF and Solvay, both members of the chemical industry group CEFIC, are among the companies that appear to be stuck between two opposing positions. Access to cheap energy is crucial for such an energy intensive sector, and the chemicals industry is campaigning for the exploitation of shale gas, whilst claiming to be a fervent supporter of the fight against climate change.

In response to the Commission’s proposed climate package, CEFIC advocated a “realistic” approach to climate change, whereby the goal of European objectives should depend on shared commitments from companies in the East.

Solvay and BASF are also both members of the World Business Council for Sustainable Development, an organisation that promotes environmental responsibility in business.

Contacted by EurActiv, both BusinessEurope and CEFIC declined to comment on the issue.

Oiling the wheels of influence

The Policy Studies Institute also examined the means used by lobbyists to influence policy makers. Their report states that “lobbying or campaign funding can […] arguably represent the greatest impact a company can have on protecting — or harming — the environment”. In a 2013 meeting with the European Commissioner for Climate Action, a group of chemical industry CEOs said that the CO2 emissions reduction objective of 30% by 2030 would accelerate the deindustrialisation of the continent. A few days later, these words were picked up by Günther Oettinger, the Energy Commissioner at the time.

Interest groups also send their members to meet and influence MEPs, even if they do not all have the same traction on climate questions. According to one lobbyist cited in the Westminster report, only a tenth of MEPs have a deep understanding of the issues surrounding climate change, and of these select few, only around one third have any real influence in Parliament.

Bring conflicts of interest under control

Many companies, sensitive to the paradoxical nature of the interest groups they support, have recently withdrawn from organisations with poor environmental records. Last autumn, Microsoft, Google, Yahoo and Facebook all left the American Legislative Exchange Council (ALEC), which is openly opposed to renewable energy. Unilever also left BASF last August because of its weak environmental positions.

EU policy held to account

But the seemingly endless conflicts of interest do not end with businesses: the new European Commission has fallen prey to the very same inconsistencies with its Energy Union plans.

>> Read: Poland calls for EU energy union

This project aims to reduce CO2 emissions and boost business competitiveness and energy security; three broadly contradictory objectives. The first requires huge investment in renewable energy sources, the second in coal and the third in large scale trans-continental gas infrastructure. The uneasy business position on climate change reflects an absence of hierarchical order among the EU’s own climate and energy policies.

>> Read: Energy union aims for elusive 10% power grid interlinkage

Background

The EU launched the European Transparency Initiative in 2007, to lift the veil on public affairs in Brussels, as well s in the other European capitals. Since this legislation, new transparency initiatives have been put in place, including the Transparency Register, which came into force in 2011. This publicises information on pressure groups that try to influence European politicians. The Commission has also launched a Register of Expert Groups.

Further Reading

Policy Studies Institute, University of Westminster

Press articles