It’s not enough for companies to report about their financial activities and liabilities as required by law, according to Sen. Sheldon Whitehouse. Nor is it enough for the U.S. Securities and Exchange Commission to demand, as expected soon, that businesses report about climate liabilities as well.

"They should also be reporting their climate political activity," the Rhode Island Democrat said at the GreenBiz VERGE Net Zero virtual event Tuesday. "There should be an audited corporate political footprint statement that looks at lobbying, that looks at campaign contributions, that looks at dark money expenditures, and that looks at trade associations and gives the CEO and the board of directors and the shareholders an accurate view of what the corporation's stance is."

The senator's call reflects a growing disdain over the gap between corporations' decarbonization commitments and their support for political candidates undermining climate action. UN Secretary-General António Guterres, also urged, in early November, businesses not only to embrace accountable net zero transition plans but also to publicly advocate for "decisive climate action" and disclose "all lobbying activity."

"And frankly, a company shouldn't be allowed to attend a COP meeting, or sponsor things at a university without having brought its certificate of good behavior, its audited corporate political footprint statement," Whitehouse said.

On the surface, at least, numerous big businesses have flexed their political muscle to push for the passage of climate-friendly legislation. Many wrote numerous letters of support to Congress in favor of the U.S. Inflation Reduction Act (IRA). Signed into law in August, it offers fe emissions reductions by incentivizing clean energy and carbon capture technologies.

In early August, for example, the nonprofit Ceres engaged more than 40 companies collectively representing $1 trillion in annual revenue, including Danone North America, Ford Motor and Unilever, to advocate for the IRA. The CEO Climate Dialogue, whose members include 22 corporations including BASF, Citi and DSM, also expressed support for the bill’s focus on advancing clean energy.

However, CEO statements only go so far, according to Whitehouse said. "And unfortunately, Congress is surrounded by an enormous apparatus of corporate political influence that can easily limit what we can achieve." This includes fossil fuel lobbying, campaign contributions and dark money operations by which businesses and trade organizations exert their power in Washington, which all worked against the IRA's passage, according to the Rhode Island lawmaker. The law passed through the rare process of budget reconciliation and without one Republican vote.

If corporate America could switch on that machinery of political influence to further instead of hamper climate legislation, it would make an incredible difference in raising collective ambitions, Whitehouse added.

 

Sen. Sheldon Whitehouse delivering his 280th "Time to wake up" speech.

"Because all the time I see companies that say great things and maybe even do great things within their four walls, and even within their supply chains," he said. "But when they come to Congress, all of that ambition evaporates, and actually often is reversed so that their political influence operation is arguing against the things that they're publicly touting. And that is a bad gap for a company to be saying one thing and doing another — and the quicker the CEOs and the board know about the discrepancy, the quicker they can correct it. And the faster we move forward on climate."

'Your ticket to participation in civilized society'

How can businesses exert their power to advance climate action that ultimately works its way into policies?

Whitehouse suggested that professionals pressure the organizations in which they participate, including university alumni groups and environmental nonprofits, to require the "corporate political footprint" he envisions as a requirement of admission in meetings and forums. That will reveal "who is there under a mask of wanting to look sustainable, while actually firing torpedoes into Congress's efforts to solve the problem," he said.

This "political footprint" should be enforced through corporate peer pressure rather than through a government mandate, Whitehouse added. "This is something that people of goodwill can simply require as your ticket to participation in civilized society regarding environmental stuff."

The AAA framework for climate policy leadership. (Source: EDF)

Victoria Mills, managing director of EDF+Business, noted the similarity between the senator’s idea and her nonprofit’s AAA Framework for Climate Policy Leadership, which encourages companies to "advocate, align and allocate."

EDF since 2020 has also produced a "Climate Authenticity Meter" that color-codes corporate actions on five levels, from "highly obstructs" to "highly supports."

Other efforts to reveal corporate policy actions and gaps include the the U.K. think tank Influence Map’s 2022 Corporate Climate Policy Footprint and its 2021 A-list of climate policy engagement.

What else companies should do

Whitehouse, who co-founded the Bicameral Task Force on Climate Change in 2013 and in 2011 the bipartisan Senate Oceans Caucus, advocates for full disclosure across the spectrum of corporate political activity.

Why do businesses with strong net zero goals need to support climate policy in the first place?

"The reason for that is that no one has identified a pathway to climate safety that bypasses legislation," he said. "There are wonderful things that companies can do, there are things that even individuals can do. But it really is going to require action by Congress to get us onto a pathway to safety.”

Whitehouse has been a dogged advocate of climate action, making hundreds of weekly "Time to wake up" speeches on the issue before the U.S. Senate. In each speech he displayed a dog-eared green poster — possibly the most-used in the history of Senate — displaying the phrase next to a photo of Earth.

Whitehouse said he meant to stop at his 179th "Time to wake up" address in January 2021, a hopeful moment when President Joe Biden came to office after running on a "fact-based, uncorrupted climate agenda." However, the senator 11 months later gave his 280th speech when the Build Back Better plan was stuck in Congress. It ultimately passed six months later.

"And then ultimately, the big kahuna here is you've got to look at the big dark money spends, because we've seen a billion dollars and more in dark money just pour into this recent election," he said about the 2022 midterm elections at the VERGE virtual event. "And I think a lot of it is fossil fuel money into Republicans. And I think the price of that for the Republican Party is that they have to do nothing on climate change and block our actions."