The publication of Bayer’s first Industry Association Climate Review has been welcomed by institutional investors engaging with the company through Climate Action 100+.
The review sets out the company’s position on climate policy and assesses the alignment of the industry associations and trade groups that it is involved in. It found that whilst 32% of industry association positions examined were fully aligned, over half have no public positions on climate-related issues that are priorities for Bayer.
The Church Commissioners for England and Union Investment engaged with Bayer as part of Climate Action 100+, coordinated by IIGCC. Comments from the investors were included in Bayer’s press release announcing the review’s findings.
“The Church Commissioners welcome Bayer’s first Industry Association Climate Review and engagement with Climate Action 100+. Bayer’s commitment to transparency and their engagement with misaligned and partially misaligned associations are appreciated, and we look forward to seeing tangible results. We also welcome Bayer’s aspiration to work with relevant organisations that currently have no climate stance to develop positions that support the low carbon transition across the global economy. The Church Commissioners will continue to engage with Bayer on environmental issues and value our ongoing constructive dialogue.” Bess Joffe, Head of Responsible Investment at The Church Commissioners.
“We are very pleased to see the publication of Bayer’s first Industry Association Climate Review. The results evidence a lack of positioning on climate-related issues from over half of the organisations assessed and reinforces the critical importance of company engagement around this topic to prevent misalignment between rhetoric and action. Through ongoing dialogue as part of Climate Action 100+, Bayer has shown its openness to investor feedback and its commitment to support and advocate for science-based climate policy. Union Investment looks forward to continued engagement with Bayer on its increased alignment with the Climate Action 100+ Net-Zero Company Benchmark.” Janne Werning, Head of ESG Capital Markets and Stewardship at Union Investment.
Bayer acknowledges the influential role of investor engagement as part of Climate Action 100+ in its report. Werner Baumann, Chairman of the Board of Management of Bayer AG & Chief Sustainability Officer noted in the report’s opening letter that he would like to “thank the investors like those who started Climate Action 100+ for including Bayer in this process and for their insightful and valuable input. You are helping us evolve and we are listening.”
IIGCC coordinates investor-led engagements with the European companies on the Climate Action 100+ focus list. The publication of this report builds on years of constructive dialogue with Bayer from a number of investors that have engaged the company as part of Climate Action 100+. Climate Action 100+ is the world’s largest investor engagement initiative on climate change.
“I welcome the publication of Bayer’s first Industry Association Climate Review and congratulate the hard work of investors who have been engaging with the company around this issue. The review’s findings demonstrate the work that needs to be done in extending the focus of climate policy to wider trade and membership organisations. This is a critical step to improving transparency on climate lobbying activity. Companies must walk the talk and proactively ensure climate policy alignment with industry associations they are members of and take the appropriate action if they are not.” Stephanie Pfeifer, IIGCC’s Chief Executive and current Vice-Chair of the Climate Action 100+ Steering Committee.
Engagement milestones
- October 2018: IIGCC members write to Bayer flagging newly published European investor expectations on corporate lobbying on climate change (here)
- 2019: IIGCC members coordinating workstream on climate lobbying continue to engage Bayer around this topic and noted willingness to file a shareholder resolution
- September 2020: Climate Action 100+ Steering Committee sends letter to Bayer, asking for a commitment to disclosures aligned to the Climate Action 100+ Net-Zero Company Benchmark and increased transparency around lobbying disclosure
- January 2021: Investors engaging Bayer discuss filing resolution around absence of lobbying disclosure review
- February 2021: Following significant engagement with investors, Bayer commits to publishing a review assessing the alignment of the climate policies of its industry associations
- August 2021: Climate Action 100+ engagement leads review plan and methodology with Bayer
- September 2021: Bayer and Climate Action 100+ engagement group discuss preliminary findings
- October 2021: Bayer publishes first Industry Association Climate Review
IIGCC and its members would like to acknowledge the important role of InfluenceMap as a civil society partner, which has provided critical insight throughout the engagement dialogue.
About IIGCC
The Institutional Investors Group on Climate Change (IIGCC), is the European membership body for investor collaboration on climate change and the voice of investors taking action for a prosperous, low-carbon future. IIGCC has more than 275 members, mainly pension funds and asset managers, across 16 countries, with over €35 trillion in assets under management. IIGCC works to support and help define the public policies, investment practices and corporate behaviours that address the long-term risks and opportunities associated with climate change. For more information visit www.iigcc.org and @iigccnews.
About Climate Action 100+
Climate Action 100+ is the world’s largest investor engagement initiative on climate change. It involves more than 615 investors, responsible for over $60 trillion in assets under management. Investors are focused on ensuring 167 of the biggest corporate greenhouse gas (GHG) emitters take the necessary actions to align their business strategies with the goals of the Paris Agreement. This includes improving corporate governance, reducing GHG emissions, and strengthening climate-related financial disclosures.
The 167 companies include the initial 100 ‘systemically important emitters’, identified with the highest combined direct and indirect GHG emissions, and additional companies selected by investors as critical to accelerating the net zero transition.
Launched in 2017, Climate Action 100+ is coordinated by five investor networks: Asia Investor Group on Climate Change (AIGCC); Ceres (Ceres); Investor Group on Climate Change (IGCC); Institutional Investors Group on Climate Change (IIGCC) and Principles for Responsible Investment (PRI). These organisations, along with five investor representatives from AustralianSuper, California Public Employees’ Retirement System (CalPERS), Gam Investments, Ircantec, and Sumitomo Mitsui Trust Asset Management form the global Steering Committee for the initiative. Follow us on Twitter: @ActOnClimate100.