Accelerating Climate Action at Yara International

PGGM, in collaboration with ShareAction, is co-filing a shareholder resolution at Yara International Annual General Meeting late May requesting the company to publish science-based scope 3 greenhouse gas emission reduction targets. These targets should cover the short, medium and long term, align with the goal of limiting global warming to 1.5°C, include upstream as well as downstream emissions and lead to an absolute reduction in emissions.

Yara’s upstream emissions are emissions from the supply chain, such as natural gas, the raw material for fertilizer. Downstream emissions are related to the transport or use of sold products.

Yara International, one of the largest producers of fertilizer globally, is also one of the largest emitters of greenhouse emissions in the Netherlands, both in terms of CO2 emissions as well as nitrogen emissions, leading to adverse biodiversity impacts and contributing to the ‘stikstofcrisis’ or nitrogen crisis that the Netherlands are currently experiencing.

Yara has previously published a scope 3 reduction target which excludes upstream emissions and would only reduce emissions by 11.1% by 2030 from a 2021 baseline. Yara has yet to publish a scope 3 Net Zero target. Scope 3 is highly material for Yara, as it accounts for approximately 75% of the company’s emissions. Yara’s peers, such as BASF, the largest European chemical company, have begun publishing upstream emission reduction targets.

PGGM joined investor coalition
Since 2021, ShareAction has been engaging collaboratively with Yara International, together with Cardano Asset Management, the Greater Manchester Pension Fund and the Ethos Foundation. At the end of 2023, PGGM joined this investor coalition to contribute to accelerating climate action at Yara. Since the start of the engagement, seven coalition letters were sent to Yara and three meetings were held to encourage the company to publish comprehensive scope 3 emissions reduction targets.

At the end of April, the investor coalition met with the Norwegian Government, the largest shareholder in Yara International. While Yara has said it is committed to publishing science-based targets across all scopes, the company has not provided a timeline for publishing these despite years of engagement.

Given Yara’s lack of clarity towards setting science-based scope 3 targets, the investor coalition decided to put the request to a vote during Yara International’s 2024 Annual General Meeting. The resolution submission was successfully submitted and will be a voting item during the AGM. PGGM will be attending the Yara International Annual General Meeting, being held on May 28th, 2024, and give a statement in support of the resolution.