BP, formerly known as British Petroleum, is one of the world's largest suppliers of oil and energy. In 2020, the company announced its transition from an 'International Energy Company' to an 'Integrated Energy Company,' prioritising delivering solutions to customers over producing resources. This new strategy includes partnering with cities and core industries in decarbonisation efforts, lowering emissions by 30-35% by 2030, and delivering long-term value for shareholders. Institutional investors, including BlackRock, Inc., State Street Corporation, and Menora Mivtachim Holdings Ltd, own 8.4% of BP.
BP scaled up oil and gas production after Russia's invasion of Ukraine in 2022 and recorded record profits of $28 billion. However, it's crucial to measure BP's sustainability pledges, especially those concerning the environmental crisis, against its actions. The then newly appointed CEO, Bernard Looney, claimed that the company's 'ambition' was to be net-zero by 2050, giving five aims to help achieve this, as well as five further aims to help the world achieve net-zero.
It's essential to note that 'ambition' does not mean the same as 'target.' These pledges are not binding, giving BP a technical 'get-out-of-jail-free card' if they fail to execute these aims. While its emissions from oil and gas are down 15% compared to its 2019 figure, excluding BP's former 19.75% share of production in the Russian oil company Rosneft who recorded a $12 billion profit in 2022, aim 9 of BP's steps to support the world in reaching net-zero is to become a 'Transparency Leader.'
Some of BP's other 'aims' cover different aspects of their operations such as production, sales, and investments into renewable sources, which BP terms 'transitional growth engines.' Aim 6 details the company's will to support net-zero policies such as the US's clean energy-oriented Inflation Reduction Act passed in 2022. In 2021, BP aimed to 'improve people's lives,' including employees and people living where BP operates.
However, the death of a 21-year-old Iraqi boy named Ali Hussein Jaloud in April 2023, who lived next to one of BP's largest oilfields, sparked outrage just days before BP's annual shareholder meeting. Ali was diagnosed with acute myeloid leukaemia, linked to the poisonous pollution released by gas flaring, a 'wasteful and avoidable' practice used by oil companies to burn off natural gas expelled during drilling. Ali was scheduled to ask a question at the annual shareholder meeting. In his place, his father intends to ask why BP did not use its vast profits to help save his son's life.
In February 2023, BP announced it would be cutting back on one of its key pledges from 2020 to reduce oil and gas production by 40% by 2030 relative to its 2019 value, to a figure of 25%. Looney stood by this decision, arguing that energy 'security' and 'affordability' are of elevated importance in the present moment. These considerations, where energy security, affordability, and sustainability come into conflict, are known as the 'energy trilemma,' which has been notably affected by the ongoing conflict in Ukraine. While BP pledged a 40% investment in renewables by 2025, with the intention of increasing this to 50% by 2030, they simultaneously invested $8 billion into fossil fuel production by 2030, which they claim is needed to power their energy transition.
BP’s status as a shareholder company makes its renewable transition more challenging, their commitment to delivering value for shareholders is a key focus, and fossil fuels remain the most certain way of procuring that. However, the company’s shareholder base is growing increasingly climate-conscious – half of its biggest contributors are part of the group Climate Action 100+, an organisation that invests in high-emitting corporations to ensure climate urgency. This group are essentially forcing BP to improve their sustainability from the inside, but there still remains a significant cohort who remain financially focused and intent on stability and maximising their shares. Despite the forward momentum gained by sustainable energy investments and insider pressure to improve environmentally conscious decisions, when coupled with insufficient scaling down of fossil fuel operations, this will not bring about the necessary reductions in emissions to stay in line with the Paris Agreement, let alone net zero. In their Big Oil Reality Check report, Oil Change International found that BP’s current plans are “grossly insufficient” and are not “anywhere close to the bare minimum for alignment with the Paris Agreement”.
It is important to note that, among the ‘Big Oil’ companies, BP is one of the better performing actors regarding net zero ambitions, its renewable investment portfolio and engagement with climate legislation are well above the steps taken by US companies such as Exxonmobil and Chevron, in particular, have done spectacularly little to address sustainability concerns and have profited even more hugely in the past year. Nonetheless, it is crucial
that governments, media, NGOs and individuals continue to hold BP accountable; the
steps they are taking are not enough, insufficient in saving lives like Ali’s
and insufficient in reversing the copious damage they have done to our planet.
Petitions to lobby the government to introduce stricter policies on oil
exploration ventures or corporations who fail to meet sustainability targets
are essential to holding BP and other companies accountable. Incorporating environmental
factors into your voting decisions, using public transportation, and raising
awareness are all things you can do as an individual to help incite positive change
in this field, but in the end it really comes down to BP, and whether they are truly willing to move beyond petroleum.