Oil Refiner Valero to Disclose Climate Lobbying After Criticism

Source: By Gerson Freitas Jr, Bloomberg • Posted: Thursday, March 4, 2021

Valero Energy Corp., one of the largest U.S. oil refiners, is planning to publish details of its climate lobbying activities after an investor pressed the company for more disclosure.

Valero will release a report later this year, it said in an emailed statement Wednesday. The decision follows discussions with Mercy Investment Services Inc., which had filed a proposed shareholder resolution demanding to know how Valero’s lobbying aligns with global efforts to fight climate change. That resolution has now been withdrawn, Valero said.

It’s one of the first times a U.S. energy company has backed down and agreed to improve transparency over lobbying and the environment. Multiple industries are facing similar pressure to disclose how their political activities align with the 2015 Paris climate accord.

U.S. regulators last month denied a requestby Exxon Mobil Corp. to block a similar shareholder resolution filed by both Mercy Investment and BNP Paribas Asset Management. Investors will now vote on the resolution at Exxon’s annual meeting in May

Mercy Investment, which manages the financial resources of the Sisters of Mercy, argued that Valero hadn’t provided enough information to help investors understand whether its direct lobbying activities, or indirect lobbying through trade associations, are in accord with the Paris goals.

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Valero already discloses direct and indirect lobbying expenditures, but the company’s policies don’t appear to require regular board oversight, Mercy Investment said in the resolution that’s now been withdrawn.

Some European energy companies have already taken steps on the issue. In January, Total SE said it will withdraw from the American Petroleum Institute after it found the group’s climate positions weren’t fully in line with the company’s climate stance. Last year, BP plc left three U.S.-based industry groups — American Fuel and Petrochemical Manufacturers, Western States Petroleum Association and Western Energy Alliance — after finding their climate-related policies and activities weren’t aligned with its own position.

“We hope Valero will be moving in the direction of European energy companies,” said Mary Minette, director of shareholder advocacy at Mercy.