Case study by Öhman

Investor: Öhman
HQ: Stockholm, Sweden
USD AUM: $9.6 billion (as at 31/03/2018)
Asset mix: Global equities and fixed income


Swedish multinational companies are to a large extent actively working to support sustainable development. One way this has manifested is through active participation in the international arena. Several Swedish companies attended the Paris climate conference (COP21) in 2015, bringing the corporate view to the agreement. Some companies also took part in the discussions leading up to the launch of the SDGs.

Compared to efforts by companies to reduce the impact of their own operations, corporate political actions – like lobbying – can have a greater influence on climate change, and arguably represent the biggest impact a company can have on protecting the environment. Öhman is concerned that lobbying can cause reputational risks if it contradicts a company’s publicly-stated positions, since a company’s reputation is an important component of shareholder value.

Öhman’s perspective

Our expectation is that companies will ensure that they do not lobby against positive climate positions. We therefore expect companies to disclose lobbying activities on:

  • climate-related issues at the national and international level; and
  • the processes to ensure consistency between their public position on climate change and those of the trade associations of which they are a member, and actions to ensure such consistency where there is a misalignment.

In 2015, Swedish media drew attention to corporate climate lobbying and the discrepancy between corporations’ progressive climate profiles and their indirect impact on political processes, leading to a slower climate legislation development. As a result, one company discontinued its membership in a US-based industry association.

Öhman’s engagement

Öhman subsequently assessed corporate climate lobbying in Swedish companies to understand the magnitude of the indirect impact companies have on political processes, and to ensure that shareholder money is used appropriately. As a long-term investor, it is important for us to consider how the companies we invest in act to reduce their negative impact on the environment. We are convinced that weaknesses in international climate legislation and implementation delays increase the risk of our investments.

Transparency among Swedish companies has improved in recent years. In 2016, 65 Swedish companies reported to the Climate Disclosure Project (CDP); 13 have set science-based targets and it is common practice to publish a sustainability report – often in line with the Global Reporting Initiative (GRI). With our project, we wanted to ascertain the extent to which companies were transparent regarding their memberships of industry associations, and how they identify and manage the alignment of their climate positions compared to those of industry associations with political influence.

Selecting target companies for the engagement

Companies were chosen based on:

  • research by InfluenceMap identifying the lowest performing industry networks according to their climate positions and interaction with policy makers on climate-related issues; and
  • of these industry associations, the Swedish companies that were selected held active member roles (such as being part of the board, advisory committee or equivalent).

The outcomes from the selection process were:

  • The identification of two business networks:
    • National Mining Association (NMA); and
    • National Association of Manufacturers (NAM).
  • The identification of four Swedish large-cap companies that are members of the networks (two in each).


A letter was sent to each of the four companies. The letter asked the companies to disclose lobbying activities on climate-related issues and the oversight processes used to ensure trade associations take consistent positions. Specifically, we asked the companies to answer:

  • How does the company view the industry association’s position on climate change?
  • Is it in line with the company’s views?
  • Does the company use its membership to influence the industry association’s position if it clashes with the company’s own views?
  • How will the company act if this misalignment remains?


The key findings from the engagement were:

  • Two companies responded promptly, with conference calls arranged swiftly. One company responded via email and the other did not respond at all.
  • All four companies considered climate change as a reality and an issue that will have a material impact on their operations. They all referred to associated risks and opportunities and have set goals related to CO2 emissions – in their own operations as well as in product development.
  • All four companies report according to GRI and to CDP (even though two companies declined to respond to CDP the year after). All companies disclosed membership of organisations such as UN Global Compact, WWF Climate Saver and Swedish Leadership for Sustainable Development. However, they all omitted memberships that could be regarded as controversial. One company provided a list of 10-15 different memberships in its GRI report, but did not mention membership in the network Öhman identified.
  • The three companies that responded said they used their membership to influence the relevant industry association but did not report on any subsequent outcomes.
  • No companies were prepared to discontinue any memberships.
  • The companies responding had all delegated the responsibility for membership to national or regional branches, meaning no board oversight is in place.
  • In the annual sustainability report published after the engagement activity, no significant progress could be identified.


There is a clear discrepancy between all companies’ public positions on climate change and the positions of the two industry associations. Unfortunately, this does not seem to be an issue for the companies, hence the reputational risk remains.

It is understandable that it can be difficult to leave an industry association since it often deals with several issues that are important to its members. Furthermore, clients of the companies can often be a member of these associations. It is therefore important for the companies to voice key discrepancies and seek cooperation with other companies to influence the association. Such activities should then be reported to shareholders.

Next steps

Going forward, Öhman will maintain dialogue with these companies to monitor any progress in managing alignment with industry associations, and will look to engage further if necessary.

Download the full report

  • Download report

    Converging on climate lobbying: aligning corporate practice with investor expectations

    May 2018