Award-winning methane engagement expands reach and impact

The collaboration is one of Nordea’s climate engagements and last year it included a successful field trip to Texas where we had dialogues with several oil and gas companies with a positive outcome. 

In our engagement with the companies we ask them to join the Oil and Gas Methane Partnership (OGMP 2.0), which is the global ‘gold standard’ in methane measurement, reporting and target-setting. The OGMP 2.0 aims to deliver a 45% reduction in the industry’s methane emissions by 2025 and a 60-75% reduction by 2030. A total of fourteen companies in the engagement group have now joined the initiative.  

We asked Eric Pedersen, Head of Responsible Investments, and Renée Tengberg, ESG Director, Climate and Nature, why it’s crucial to reduce methane emissions and why investor and partner collaboration is important for the success of this initiative. 

Eric, why is it important to collaborate with other investors and expert partners?

"One reason is that raising the collective ownership share in target companies and involving investors across relevant markets increase the likelihood of engagement success. We have onboarded around 20 investors with over EUR 3.7 trillion in assets under management and have more influence when we tackle this issue together. Another reason is that a collaborative engagement is an effective way to facilitate knowledge sharing, elevate investor expertise and shape opinion on methane. We can also draw on expert partners such as the Environmental Defense Fund (EDF), Carbon Tracker and the United Nations Environment Programme (UNEP), which contribute scientific expertise and data insights.”

Renée, how do we engage with the companies?

“We use various approaches to influence the company employees best positioned to define the roadmap to near-zero methane emissions and drive mitigation. For example: letters to the board and CEOs; one-on-one meetings with company leadership and specialists; practical workshops together with UNEP and EDF experts and OGMP 2.0 member companies; and field trips to meet with plant personnel."

"Since the trip to Texas we did an investor trip to Calgary in Canada in September last year. We co-hosted a half-day engagement workshop for Canadian companies with the Californian State Teachers’ Retirement System (CalSTRS), spoke at a conference and engaged with more than five companies during that week. Outside of investor trips, we engage with companies throughout the year in virtual meetings, e-mail dialogue and face-to-face, when possible.”  

And have we seen any tangible results when it comes to emissions reduction?

“Many of the companies in the engagement group are reporting significant methane emissions reductions but with varying data quality and often based on estimated emissions. Company reported methane emissions likely represent the tip of the iceberg of actual methane emissions. Direct measurements of methane in the US have shown emissions to be four times greater than earlier estimates, and eight times higher than current industry targets. It is therefore imperative that these companies achieve near-zero methane emissions backed by the credible OGMP 2.0 Gold Standard reporting”.