Trade bodies undermining sustainability policies of their members

30th March 2015


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Garry Smith

Many major multinational companies with strong sustainability policies are at the same time members of trade associations that are lobbying against EU climate policy, according to the Policy Studies Institute (PSI).

A report, Lobbying by trade associations on EU climate policy, profiles the responses of powerful business bodies to consultations on key European climate change policies, including the emissions trading system (ETS).

For example, the European Chemical Industry Council (Cefic) is reported to have argued that strengthening the ETS would "directly worsen the measures against carbon leakage without any environmental need", while BusinessEurope, which has national business federations, such as the CBI, in its membership, is reported to have commented that EU climate targets undermine industrial competitiveness.

PSI focused on eight trade bodies and says that lobbyists employ various tools and mechanisms to exert influence over EU climate policy. These range from organising dinner events between chief executives of large companies and EU commissioners to push new policy initiatives in the council of Europe and the European parliament, and providing technical information and advice.

The report questions whether the lobbying by trade associations is aligned with the published sustainability policies of some of the companies they represent. Commenting on the research, Ben Fagan-Watson, lead researcher and research fellow at PSI, said: "Companies that are making strong commitments to deal with climate change need to ensure that their trade associations are singing from the same hymn sheet."

Some companies have taken action when their trade associations have lobbied against effective climate policy, says the report. PSI highlights how tensions over BusinessEurope's stance on environmental policies led to fast-moving consumer-products company Unilever ending its membership of the lobby group in 2014. The move was welcomed by NGOs.

Tony Long, director of WWF's European office, said: "Trade associations are notoriously difficult to hold to account because their memberships are made up largely of other associations. Only in rare cases can an individual company walk away and claim the high ground. Unilever did precisely that. We need more business leaders to stand up and be counted following the Paul Polman [Unilever CEO] example."

PSI also reports that Google left the American Legislative Exchange Council (ALEC) last year because of the trade association's opposition to action on climate change. "The people who oppose it are really hurting our children and grandchildren and making the world a much worse place", said Eric Schmidt, chair of Google. "We should not be aligned with such people. They are just literally lying."

Using data voluntarily reported by companies and collected by CDP (formerly the Carbon Disclosure Project), PSI found that businesses use trade associations more frequently than all other lobbying methods to make their views heard among policymakers. In 2014, 61% of all companies responding to CDP stated that they influenced climate policy indirectly through trade associations.


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