In October 2021 Ethical Consumer viewed KKR & Co Inc’s website looking for information on what the company was doing to tackle climate change.
Ethical Consumer was looking for the following:
1. For the company to discuss its areas of climate impact, and to discuss plausible ways it has cut them in the CA, and ways that it will cut them in the future.
For the company to not be involved in any particularly damaging projects like tar sands, oil or aviation, to not be subject to damning secondary criticism regarding it’s climate actions, and to have relevant sector-specific climate policies in place.
2. For the company to report annually on its scope 1&2 greenhouse gas emissions (direct emissions by the company), and,
3. to go some way towards reporting on its scope 3 emissions (emissions from the supply chain, investments and sold products).
4. For the company to have a target to reduce its greenhouse gas emissions in line with international agreements (counted as the equivalent of at least 2.5% cut per year in scope 1&2 emissions), and to not count offsetting towards this target.
1. In its 2020 Environmental, Social, and Governance (ESG) report the company stated it achieved carbon neutrality in 2019. However, this was done through the use of offsetting programs, one of which was a forestry program, which Ethical Consumer did not consider an effective carbon management tool. KKR stated it encouraged environmental awareness in offices and integrated recognised environmental standards into new design. The company stated it continued to “advance and evolve our approach to incorporating the consideration of climate-related risks and opportunities into the investment life cycle. We utilize the framework developed by the Task Force on Climate-related Financial Disclosures (TCFD) as a primary input”. The company discussed investing in renewables. However, this was just among other investments – the company website detailed partnerships with oil companies including Colonial Pipeline, Comstock resources, EXCO Resources and Westbrick Energy.
As such it was not considered to have met part 1 as it was invested in fossil fuel projects.
2 and 3. The company stated in its 2020 Environmental, Social, and Governance (ESG) report, “We measured our carbon footprint following the GHG Protocol Corporate Accounting and Reporting Standard to calculate scope 1, 2, and relevant scope 3 emissions. It is based on the Firm’s direct impacts and operations; it does not account for the impacts of our investments.” The “Invested in People” section of the company website listed KKR’s total Scope 1, 2 and some Scope 3 emissions combined to be 24,342.2 mtCO2e however this did not account for the impacts of their investments.
As there was no further clarity surrounding the emissions from each scope separately and the company did not include the impact of its investments in its Scope 3 calculations, this was not considered enough to meet parts 2 or 3.
4. No carbon reduction targets could be found and it was not considered to have met part 4.
Overall, KKR and Co Inc received Ethical Consumer's worst rating for carbon management and reporting and lost a whole mark under the Climate Change category.