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Anglo-Dutch global oil and gas giant Shell funded an industry group lobbying to block efforts by U.S. banks to tackle climate change, an investigation has found. Even as the corporation made new sustainability pledges and made net-zero its goal publicly, documents reviewed by nonprofit journalism platform SourceMaterial and HuffPost showed that Shell backed the lobbyists in favour of the controversial federal rule on fossil fuel financing that the Trump administration implemented in its final days.
Shell funded an industry lobbying group that pushed for the rule, which was introduced during former president Trump’s final week in office, that would require banks to be “impartial” in choosing the companies they finance, a move widely seen to undermine climate policies that major banks have been putting in place to eradicate loans to oil drilling and coal mining operations.
This was revealed in a joint investigation undertaken by journalists at SourceMaterial and HuffPost, which calls into question Shell’s public-facing climate action statements, which include aiming to reduce its emissions to net-zero by 2050.
Amid a reckoning in the finance industry over its role in fuelling the climate crisis, the world’s biggest banking institutions have slowly been implementing new policies to end lending to some of the most environmentally disastrous projects, such as oil drilling in the Arctic and coal mining.
Among some of the banks that have ruled out Arctic oil and gas development financing are the six biggest U.S. banks – Goldman Sachs, JPMorgan Chase, Citi, Bank of America, Morgan Stanley and Wells Fargo. An analysis published in February last year involving institutions representing 77% of global GDP also indicated that similar climate-friendly moves were being made by the majority of central banks and regulatory firms around the world.
There is an obvious disconnect between fossil fuel companies’ actions and their words.Graham Steele, Director, Corporations and Society Initiative at Stanford Graduate School of Business
Since President Biden entered into office, the federal rule in question that the Shell-backed group lobbied for has been frozen, alongside a number of other pending Trump-era policies. But there is a chance that the rule could be revived by the yet-to-be-appointed Comptroller of the Currency who acts as the independent financial watchdog.
Commenting on the revelation, Graham Steele, director of the Corporations and Society Initiative at Stanford Graduate School of Business, told SourceMaterial that Shell’s actions is indicative of an “obvious disconnect between fossil fuel companies’ actions and their words.”
It’s not the first time that Shell has displayed outright instances of greenwashing, with previous investigations showing that it has invested in dirty energy projects through their venture capital units despite its promises to green its operations.
Fellow fossil fuel behemoth, BP, has also been guilty of serious greenwashing. In August last year, an inquiry led by Greenpeace’s journalism team Unearthed revealed that the firm has been funnelling millions of dollars from its venture capital unit, which was supposed to help transition BP into a low carbon economy as a part of the firm’s pledge earlier this year to achieve net zero by 2050, into companies that will increase the supply and demand for dirty energy.
Lead image courtesy of Jeff J Mitchell / Getty Images.