Activist investors score victory at BP annual meeting

Activist investors this week scored a major victory after persuading most shareholders to back a resolution obliging BP to set out the potential cost of climate change to its business - but the company pointed out the risks of unilaterally embracing such an agenda.

Major investors in BP and other major mining and energy companies are facing pressure from campaign groups to dump shareholdings in such groups, on the grounds that they are partly responsible for global warming.

Carl-Henric Svanberg, BP's chairman, warned that campaigners could be exaggerating the power that western oil majors have over the world's remaining oil and gas reserves.

"The supermajors are no longer in control of the lion's share of the world's hydrocarbon assets," he said. "They control less than 10 per cent - over 90 per cent are with national [state-owned] oil companies."

His comments came as 98 per cent of shareholders voted in favour of a resolution obliging the company to increase reporting on the impact of climate change on its business.

The resolution, which was supported by the company, was tabled by "Action for A", a coalition of investor groups including CCLA, the Church Commissioners and local authority pension funds. Many other institutional shareholders and non-governmental organisations publicly backed the coalition, which has proposed a similar resolution for Shell's forthcoming meeting.

Mr Svanberg gave his broader support for a handful of strategies which he said could mitigate the worst effects of growing global demand for energy and power, including the introduction of an enforceable carbon tax and continued government subsidy for renewable energy sources until they become fully competitive sources of power.

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Mr Svanberg said that while greater emphasis on gas would improve the company's green credentials, overall fossil fuels "will be part of the energy mix for many decades to come".

He also warned investors that they might have become overly optimistic about the prospects of continued strong returns based on high, stable oil prices. "The price of oil has gone back to the old, volatile days after six years of relative stability," he said.

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