Billionaires responsible for a million times more greenhouse gases than the average person – Oxfam
The investments of just 125 billionaires emit 393 million tonnes of CO2e each year – the equivalent of France. According to a report published by Oxfam today, a billionaire’s average annual emissions is a million times higher than someone outside the richest 10 per cent of humanity.
The report, Carbon Billionaires: The investment emissions of World’s richest people, analyses the investments of 125 of the richest billionaires in some of the world’s biggest corporates and the carbon emissions of these investments.
The report finds that these billionaires’ investments – with a collective $2.4 trillion stake in 183 companies – give an annual average of 3m tonnes of CO2e per person, which is a million times higher than the average 2.76 tonnes of CO2e for those living in the bottom 90 per cent.
The actual figure is likely to be higher still, as published carbon emissions by corporates have been shown to systematically underestimate the true level of carbon impact, and billionaires and corporates who do not publicly reveal their emissions, so could not be included in the research, are likely to be those with a high climate impact.
Danny Sriskandarajah, Oxfam GB Chief Executive said: “We need COP27 to expose and change the role that big corporates and their rich investors are playing in profiting from the pollution that is driving the global climate crisis. And it is people in low income countries who’ve done the least to cause it who are suffering the most – as we are seeing with the devastating drought in East Africa and the catastrophic floods in Pakistan.
“We need governments to tackle this urgently by publishing emission figures for the richest people, regulating investors and corporates to slash carbon emissions and taxing wealth and polluting investments. They can’t be allowed to hide or greenwash.
“The role of the super-rich in super-charging climate change is rarely discussed. This has to change. These billionaire investors at the top of the corporate pyramid have huge responsibility for driving climate breakdown. They have escaped accountability for too long.
“To meet the global target of keeping warming below 1.5 degrees Celsius, humanity must significantly reduce carbon emissions. This will mean radical changes in how investors and corporations conduct business, and how policymakers manage both.”
Studies show the world’s wealthiest individuals’ investments account for up to 70 per cent of their emissions. Oxfam used public data to calculate the investment emissions of billionaires with a stake of more than 10 per cent in a corporation, by allocating them a share of the reported emissions of the corporates in which they are invested in proportion to their stake.
The study also found billionaires had an average of 14 per cent of their investments in polluting industries such as non-renewable energy and materials like cement. This is twice the average for investments in the Standard and Poor 500. Only one billionaire in the sample had investments in a renewable energy company.
The choice of investments billionaires make is shaping the future of our economy, for example, by backing high carbon infrastructure – locking in high emissions for decades to come. The study found that if the billionaires in the sample moved their investments to a fund with stronger environmental and social standards, it could reduce the intensity of their emissions by up to four times.
Oxfam has estimated that a wealth tax on the world’s super-rich could raise $1.4 trillion a year, vital resources that could help developing countries – those worst hit by the climate crisis – to adapt, address loss and damage and carry out a just transition to renewable energy.
According to the UNEP adaptation costs for developing countries could rise to $300 billion per year by 2030. Africa alone will require $600 billion between 2020 to 2030. Oxfam is also calling for steeply higher tax rates for investments in polluting industries to deter such investments.
The report says that many corporations are off track in setting their climate transition plans, including hiding behind unrealistic and unreliable decarbonization plans with the promise of attaining net zero targets only by 2050. Fewer than one in three of the 183 corporates reviewed by Oxfam are working with the Science Based Targets Initiative. Only 16 per cent have set net zero targets.
Ahead of the deliberations at COP27, Oxfam is calling for:
- Governments to put in place regulations and policies that compel corporations to track and report on scope 1, scope 2 and scope 3 GHG emissions, set science-based climate targets with a clear road map to reducing emissions, and while at it ensuring a just transition from the extractive, carbon intensive economy by securing the future livelihoods of workers and the affected communities.
- Governments to implement a wealth tax on the richest people and an additional steep rate top-up on wealth invested in polluting industries. This will reduce the numbers and power of people in our society with excessive wealth, drastically reduce their emissions. It will also raise billions that can be used to help countries cope with the brutal impacts of climate breakdown and the loss and damage they incur and fund the global shift to renewable energy.
- Corporations to put in place ambitious and time-bound climate change action plans with short-to-medium term targets in line with global climate change objectives in a view to reach carbon neutrality by 2050.