As significant numbers of investors support or abstain on tar sands resolution, investors say BP "carried the vote but not the argument".

Reacting to the outcome of the special resolution co-ordinated by FairPensions on BP's controversial plans in the Canadian tar sands, investors who proposed the resolution at the company's AGM in London today pointed out that 15% of shareholders either supported the resolution or abstained, despite a strong company recommendation to oppose. BP may have won the vote but they have not won the argument.

Although BP made its first disclosures about its strategic and pricing assumptions on tar sands investment as a result of the resolution process, many large investors - including institutions which supported management or abstained - agree that the company has still not provided sufficient assurance that tar sands plans are financially robust, and that the greater level of transparency called for in the resolution is still required.

At the AGM, BP‘s Chairman, Carl-Henric Svanberg, faced a series of uncomfortable questions on issues including the companies' use of demand projections that assume no change in governments' climate change policies & imply catastrophic climate change, how adequate control of outsourced projects can be asserted, health impacts on local communities and financial concerns.

Catherine Howarth, CEO of FairPensions said:

"Shareholder resolutions are primarily a means to draw attention to an issue of concern to investors. The vote today is only one outcome of a wider process, which has catapulted tar sands risks to the top of BP's agenda, and has become a major topic of debate in the City. The task for investors now is to make the most of the disclosures made to date, and continue to robustly engage with BP into the future. This will be matched by an unprecedented level of scrutiny from campaigners, politicians and members of the public".

Karina Litvack, Head of Governance and Sustainable Investment at F&C Asset Management said:

"F&C abstained on this resolution in recognition of BP's considerably improved transparency regarding its involvement in Canadian oil sands. We credit this shareholder proposal for having prompted a more productive stance by the company on investor engagement. However, F&C feels that the company still falls short in certain important respects of the standard of disclosure that we believe was requested in this resolution. We want to take this opportunity to encourage BP to take a more prominent leadership role in industry-wide efforts to find ways to better manage the cumulative impacts of oil sands development in Canada."

The resolution has been the focus of intense engagement between BP and major City investors in the last six weeks, and has attracted support from major global institutional investors, particularly in the USA where 36% of BP shareholders are based. Public and investor interest in the resolution has been bolstered by a grassroots mobilisation campaign that has seen more than 5,000 people petitioning their pension providers and other large BP shareholders to back the resolution. Politicians and celebrities, including Zac Goldsmith, Simon Hughes, Alistair McGowan and Radiohead's Thom Yorke, have also endorsed the campaign.

Niall O'Shea, Head of Responsible Investing at The Co-operative Asset Management said:

"Investors will be glad that the process has prompted BP to disclose its first significant information on this controversial activity. BP's projections on profitability and carbon intensity look surprisingly rosy compared to industry averages and independent analysis. We wish them well. But investors deserve to know how these projections are arrived at. Furthermore, BP appears to be working toward the International Energy Association's 'business as usual' reference scenario of unstinting oil demand and an emissions pathway that by the IEA's reckoning could lead to a global average temperature increase of up to 6°C. This is endorsing a future where there is limited Government intervention to prevent dangerous levels of climate change. Investors need to know; ‘what is the company's long-term direction?' "

Robert Nash of WWF said:

"Tar sands threaten to lock in massive future carbon emissions at a time when all areas of the economy, and especially the energy sector, need to cut their carbon footprint. This resolution has generated a whole new level of disclosure and dialogue around the issue of tar sands expansion, and should inject further urgency into the task of establishing mandatory reporting requirements on environmental impacts and the financial risks they pose to investors".