WHEB calls on petrochemical companies to transition to safe and environmentally sound practices

WHEB is pleased to join 69 other international financial institutions and their representatives with a combined AUM/AUA total of USD 6.8 trillion that are calling on petrochemical companies to transition to safe and environmentally sound practices, by reducing fossil fuel dependency and eliminating hazardous chemicals in plastics.

The collective statement organised by financial think tank Planet Tracker commits participating investors and their representatives with exposure to the plastics value chain to request petrochemical companies producing plastic polymers to:

• Disclose and define strategies: Transparently disclose plastic impacts, establish clear strategies, and set targets for transitioning to sustainable plastic production.
• Address toxic polymers and chemicals: Commit to eliminating hazardous chemicals in their products and publicly report progress.
• Develop sustainable infrastructure: Invest in technology and infrastructure to support sustainable feedstocks.
• Establish governance: Ensure dedicated governance and accountability for sustainability commitments at the Board level, linking management compensation to circularity goals.
• Support international agreements: Advocate for a robust, legally binding international treaty to end plastic pollution, refraining from lobbying against ambitious measures.

Among the financial institutions also already committed are Legal & General Investment Management, Pictet Group, Nordea Asset Management, Achmea Investment Management, Robeco, MN, Rockefeller Asset Management, Rathbones Group Plc and Storebrand Asset Management.

Under a business-as-usual scenario, plastic leakage into the environment and associated health costs are projected to rise significantly, prompting policymakers and society to demand greater corporate accountability and sustainability.

Over the past decade, there has been a steady increase in the number of national policies addressing plastic pollution and negotiations for a global plastics treaty are now at a crucial stage. This call to action follows a statement by the financial sector calling on governments to negotiate an ambitious treaty to end plastic pollution, emphasising the importance of including the full life cycle of plastic. 

However, in the latest round of negotiations, petrochemical companies and their allies resisted calls to include the full life cycle, opposing the reduction of plastic production and opposing including polymer production in the treaty. Investors have recognised these risks and play a crucial role in driving the transition in the plastics economy to ensure long-term value creation and an alignment of business practices with global sustainability goals such as the Paris Climate Agreement and the Kunming-Montreal Global Biodiversity Framework.

The Investor Statement addresses petrochemical companies as their support for an ambitious agreement is vital:

• Plastic production is due to triple by 2060 and petrochemical companies will become the main driver of growth in oil demand
• Lifecycle emissions from plastics will more than double, making up 4.5% of global emissions
• Plastic polymers contain toxic and hazardous chemicals, out of the 16,000 chemicals present in plastics over 4,000 are identified as toxic
• Toxic chemicals and additives have an impact on human health and are, among other health issues, associated with diabetes, obesity, fertility issues and different types of cancers

These projections highlight significant plastics-related risks for petrochemical companies, encompassing regulatory, reputational, litigation, and increased consumer demand for safe and more sustainable products. These risks are financially material for corporates and their investors, and necessitates proactive corporate action.

This initiative serves as a clarion call to petrochemical companies that investors have taken note and demand decisive action of petrochemical companies towards sustainable practices. By supporting this collective statement, investors are helping to mitigate the environmental and health impacts of plastic pollution and secure a sustainable future for all.

Read the Investor Statement here or contact Nicole Kozlowski, Head of Engagement at Planet Tracker, the organiser of the statement, directly via nicole@planet-tracker.org