VW: Shareholder body says climate lobbying claims ‘raise questions’

EOS highlights tensions between carmaker’s claim of positive impact and push for ‘more flexible’ decarbonisation policies

Volkswagen’s lobbying disclosures are raising eyebrows in key parts of the investor community this week.  

In its latest sustainability statement, the carmaker said it had a “positive impact on the focus on sustainable mobility” through its policy advocacy activities. 

It made the same claim last year, in a move described at the time as “bold”.  

Whilst reaffirming its climate commitments, Volkswagen also said it “recognise[d] the need for CO2-related legislation to be made more flexible and to assume realistic timelines for implementation on the path towards decarbonisation”.

“Current legislation was developed at a time when forecasts concerning electrification were much more optimistic than the current realities of the market,” it pointed out. 

The statements have been met with concern by experts at EOS, the shareholder engagement arm of Federated Hermes. 

As well as providing stewardship services to institutional investors with trillions of dollars under management, EOS co-leads engagement with Volkswagen on behalf of influential investor body Climate Action 100+. 

When approached by Real Economy Progress about the lobbying claims, one of the firm’s senior specialists, Justin Bazalgette, said “claiming a positive impact on sustainable mobility while also calling for more flexible or delayed decarbonisation policies raises important questions about overall alignment with climate goals”.  

“We recognise the commercial pressures facing the sector,” he said, adding that, while weakening EU rules may bring short-term benefits to businesses, it may “also result in higher emissions for longer”.  

“This increases the risk of a disorderly transition and may weaken the competitiveness of European manufacturers at a time when global peers are advancing quickly,” he concluded.  

Bazalgette said EOS would continue engaging with Volkswagen to “ensure its lobbying activity supports an ambitious and orderly transition consistent with long‑term investor interests”. 

A Volkswagen spokesperson insisted there was no ambiguity about its commitment to decarbonisation, telling Real Economy Progress: “[I]n any discussions about flexibility in targets we have always been absolutely clear that in the process not a gram of CO2 savings is lost for the protection of our climate”.