Phillips 66 shareholders vote for greater transparency

Shareholders of Phillips 66, an energy company based in Houston, have approved a resolution urging increased transparency of the company’s plastics production. According to As You Sow, a Berkley, California-based nonprofit has reported that 50.4 percent of the shareholders voted for increased transparency during a recent meeting.   

The resolution requests that Phillips 66 publish a plastic report describing how it could shift its plastic production business from virgin to recycled plastic polymers. It also asks the company to assess the resilience of its petrochemical assets under virgin-to-recycled transition scenarios of five and 10 years and study the financial risks associated.  

Phillips 66 is the joint owner of Chevron Phillips Chemical Company (CPChem). According to data published in the Plastic Waste Makers Index, CPChem is the 15th largest global producer of virgin plastic resins bound for single-use applications. 

In its 2020 sustainability report, CPChem states a goal to end plastic waste. The company was also one of the first major U.S. petrochemical companies to announce a recycled plastic polymer production target. However, As You Sow says the company’s planned expansions of virgin plastic production are three times higher than its recycled plastics target. In total, CPChem’s recycled plastics target is estimated to displace less than 8 percent of its virgin plastic production volumes by 2030.  

“Petrochemical companies that are serious about their commitments to end or combat plastic pollution cannot justify the continuous and rapid expansion of virgin plastic production,” says Joshua Romo, energy and plastics associate at As You Sow. “We hope this majority vote will motivate the company to thoroughly assess its exposure to the single-use plastic supply chain and provide investors with information on how it will decrease transition risk as the world moves away from virgin and single-use plastics.”   

Experts say plastic pollution may be nearing an irreversible tipping point. The plastic lifecycle imposes costs on the environment, climate, and human health that are at least 10 times higher than the market price of plastics. At the heart of the plastic pollution problem are single-use plastics, which make up the largest component of ocean-bound plastic pollution.  

As You Sow’s resolution is based on peer-reviewed research from the Pew Charitable Trusts and Systemiq, in collaboration with global experts. It found the world can feasibly reduce ocean plastic pollution by 80 percent by 2040 using existing technology. This transition is based on a global shift to recycled plastics, tripling demand for recycled content, coupled with a one-third absolute reduction of virgin demand, mostly of virgin single-use plastic.  

“While the plastics industry frequently discusses the need to transition towards a circular economy for plastics, U.S. petrochemical companies have not adequately addressed the necessity for or the potential impacts of an expeditious transition away from virgin plastics,” says Conrad MacKerron, senior vice president at As You Sow. “In fact, as demonstrated by CPChem, many major plastic polymer producers are investing in a continuous expansion of virgin plastic production.”  

A similar proposal is pending at Exxon Mobil Corp., which has been cited as the world’s largest producer of single-use plastic resins. It will be voted on at Exxon’s annual meeting on May 25.