Institutional Shareholder Services (ISS), a prominent proxy advisory firm, has urged investors to vote against BP’s board proposal to eliminate certain company-specific climate reporting resolutions. This recommendation is notable as ISS rarely advises shareholders to oppose board-backed measures. The vote is scheduled for BP’s annual general meeting on April 23.
BP is currently refocusing on oil and gas after a challenging attempt to expand into renewables. This strategic shift is now under the leadership of Meg O’Neill, who recently became the company’s fourth CEO in 2023. The board’s proposal seeks to retire two climate reporting resolutions adopted in 2015 and 2019, which require detailed company-specific disclosures on climate issues.
ISS described the board’s move as “unprecedented in the UK context,” arguing that the board’s rationale—that the older resolutions reduce clarity and standardization in reporting—does not sufficiently justify removing these disclosures. The firm emphasized the importance of maintaining these commitments for transparency.
BP requires at least 75% shareholder approval to rescind these resolutions, which originally passed with nearly unanimous support. ISS also recommended opposing a separate proposal that would permit BP to conduct shareholder meetings exclusively online.
The BP board contends that the targeted climate reporting requirements have been largely overtaken by mandatory disclosure frameworks, such as the Task Force on Climate-related Financial Disclosures (TCFD) and climate-related Financial Disclosure Regulations, which provide more standardized and comparable data. Despite the proposed changes, BP intends to continue reporting climate data under these broader frameworks.
A BP spokesperson stated that the proposal followed extensive consultations with the company’s largest investors. The spokesperson highlighted BP’s commitment to creating a simpler, stronger, and more valuable company through transparent and standardized disclosures that facilitate clear comparisons across firms.
ISS also advised voting against a resolution from a separate group of investors led by activist shareholder ACCR, whose supporters hold about 0.4% of BP shares. This resolution calls for BP to provide additional evidence that its strategy of shifting investment from low-carbon initiatives back to oil and gas will enhance shareholder value.
Meanwhile, a growing climate campaign against BP has emerged among some European investors holding less than 0.3% of the company’s shares, led by Dutch activist group Follow This. BP did not include Follow This’s resolution on this month’s meeting agenda, which requests disclosure of BP’s long-term strategy under scenarios of declining oil and gas demand.
ISS noted that Follow This and its co-filers meet the shareholder threshold to submit proposals as written resolutions. The proxy adviser suggested that the combination of the board’s request to revoke prior resolutions, the omission of Follow This’s proposal, and the potential approval of virtual-only meetings might signal BP’s current approach to shareholder engagement and proposals.
The BP spokesperson explained that the online meeting proposal aims to enhance flexibility and enable broader, more cost-effective participation in shareholder meetings.
