Mr Carl-Henric Svanberg Chairman British Petroleum p.l.c. 1 St James's Square London SW1Y 4PD

18th August 2015 Dear Mr Carl-Henric Svanberg, In the important decision-making period surrounding COP 21 in Paris this December, we are writing about BP’s public policy position on climate change. Whilst we welcome the progress that BP is making in this area, we are concerned by the company’s continued membership of EU trade associations whose activities appear inconsistent with BP’s own position. We would first like to commend your decision to leave the American Legislative Exchange Council (ALEC), an association which has lobbied in ways that seem inconsistent with BP’s position on a number of important policy areas including climate change. We also recognise the various initiatives that BP promotes which indicate the company is aware of the challenges that climate change present, including your recent announcement that “Something substantial needs to be done. We are conscious of that ... we encourage policymakers to move forward on this when they meet in December”.1 Such statements suggest that BP wishes to play a positive role in the evolving climate debate. However, BP remains a member of various EU trade associations that have influenced climate change policy in an undesirable manner. A recent study by the Policy Studies Institute (PSI) indicates that the lobbying undertaken by BusinessEurope, Cefic, FuelsEurope and the International Association of Oil and Gas Producers (OGP) is inconsistent with BP’s recent statements on climate change.2 This research shows that these trade associations contributed to obstructive lobbying on two important pieces of legislation: the 2030 framework for climate and energy policies, and the consultation on structural options to strengthen the EU Emissions Trading System (ETS). For example, the PSI’s research indicates that BusinessEurope opposed backloading the ETS – the act of freezing the auctioning of CO2 permits – despite the fact that this is widely seen as necessary for securing a strong carbon price and reviving the system’s incentive effect. The PSI’s findings show that Cefic has similarly argued against backloading, and taken the position that top-down climate targets should only be set in the case of a substantial global agreement – a position which seems excessively onerous and discourages the EU from taking leadership on setting ambitious targets. FuelsEurope argued against targets for renewable energy, and OGP has broadly supported the view that structural reforms of the ETS are undesirable and that low-carbon technologies should not receive governmental preference. These lobbying positions seem inconsistent with BP’s apparent recognition of the need for climate action. There is a need for greater transparency on the alignment of your own climate position with that of trade associations supported through membership or other means. We are writing to urge that in cases where there appears a misalignment, for BP to review its membership and take action to publicly distance the company from inconsistent policy positions. Similar actions have been seen recently – with Unilever leaving BusinessEurope, and Shell exiting ALEC – as companies become increasingly concerned about the negative effects associated with continued affiliation.

1 Macalister, T. (2015) BP boss widens transatlantic rift in energy industry over climate change, The Guardian.

Available online from: http://www.theguardian.com/business/2015/jun/10/bp-boss-widens-transatlantic-rift-in-energy-industry-over-climate-change

2 Fagan-Watson, B. and Elliott, B. and Watson, T. (2015) Lobbying by Trade Associations on EU Climate Policy, Policy Studies Institute, University of Westminster. Available online from: http://www.psi.org.uk/pdf/2015/PSI%20Report_Lobbying%20by%20Trade%20Associations%20on%20EU%20Climate%20Policy.pdf

Such moves would reassure shareholders of the consistency of your position on climate change. They would also be valuable in providing a counter-balance to the unhelpful positions that some associations have historically taken on climate and energy polices. These associations gain legitimacy by being able to say that they speak on behalf of major industry players like BP. Your withdrawal would help undermine this claim. The challenge of climate change requires decisive and timely action. We hope BP will show leadership in ensuring that the lobbying being done on your behalf is in line with this need. We look forward to your response. Please send it to Juliet Phillips, juliet.phillips@shareaction.org, ShareAction, 16 Crucifix Lane, SE1 3JW. Yours sincerely, Lauren Compere Managing Director and Director of Shareholder Engagement Boston Common Asset Management Arne Lööw Head of Corporate Governance AP4 Swedish National Pension Fund David Adkins Chief Investment Officer The Pensions Trust Phil Vernon Managing Director Australian Ethical Investment Jon Dunn Trustee UNISON Staff Pension Scheme Helen Cadbury Chair Barrow Cadbury Stephen Viederman Chair, Finance Committee Christopher Reynolds Foundation Nick Perks Trust Secretary The Joseph Rowntree Charitable Trust Natasha Landell-Mills Head of Environmental, Social and Governance Research Sarasin & Partners LLP Tim Smith Director of Environmental Social and Governance Shareowner Engagement Walden Asset Management Natasha Lamb Director of Equity Research & Shareholder Engagement Arjuna Capital Ltd

Stephen Power SJ Treasurer Jesuits in Britain Sonia Kowal President Zevin Asset Management, LLC James Perry CEO Panahpur Julian Corner Chief Executive LankellyChase Foundation Jonathan Gillett Chair Polden-Puckham Charitable Foundation David Cutler Director The Baring Foundation Sarah Butler-Sloss Founder Director Ashden Trust Julian Sainsbury Trustee JJ Charitable Trust Mark Sainsbury Chairman Mark Leonard Trust Jamie Arbib Principle Tellus Mater Foundation Lincoln Pain CFP, AIF Effective Assets Susan Smith Makos Vice President of Social Responsibility Mercy Investment Services, Inc. Mary Beth Gallagher Acting Director Tri-State Coalition for Responsible Investment Catherine Howarth Chief Executive ShareAction