The Responsibilities of Carbon Major Companies: Are They (and Is the Law) Doing Enough?

Abstract

AbstractTransnational carbon major companies are responsible for over 30% of global industrial greenhouse gas emissions and exert tremendous influence over future global climate trajectories. Yet, they are not governed through top-down, stringent emissions limits, but are instead regulated largely by disclosure-only domestic requirements and market-based or voluntary corporate social responsibility mechanisms. Through an examination of the requirements of domestic laws such as the United Kingdom (UK) Climate Change Act 2008 and the UK Energy Act 2013, as well as the environmental and sustainability reports produced under the UK Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013, this article analyzes the regulatory requirements placed on carbon majors, and the climate change pledges and emissions of five UK-based carbon majors: BP, Royal Dutch Shell, BG Group, National Grid, and Centrica. The article concludes that the efforts to curb emissions in these carbon major entities are being subverted by company law, company theory and commercial norms such as shareholder wealth maximization.