A group of institutional investors has launched legal action against Volkswagen over concerns that the auto giant’s lobbying activities could be running counter to its stated climate ambitions.
In an October 19 announcement, ClientEarth, which is supporting the investors, said that the group had turned to legal action after Volkswagen allegedly refused repeated attempts to reveal crucial information on its corporate climate lobbying earlier this year.
This is the first time that investors have started European litigation on a climate-related matter.
Swedish public pension funds AP7, AP2, AP3, AP4, Denmark-based AkademikerPension, and the Church of England Pensions Board are involved in the lawsuit, represented by German law firm Hausfeld Rechtsanwälte.
The group argues that Volkswagen’s membership to a number of automotive and business associations could result in a “potential contradiction [that] exposes the company to reputational and operational damage and puts the security of their investments in question.”
In the announcement, ClientEarth said that investors had initially requested access to information on potential misalignments. However, after these efforts “stalled,” the investors resorted to submitting an agenda item at Volkswagen’s 2022 annual meeting. The company responded by rejecting the proposal.
“VW’s intransigence raises serious questions as to what they are scared good governance will reveal. We are shareholders that want to see the company succeed in the climate transition and in order to protect our rights and those of shareholders we are challenging VWs refusal in the courts,” said Adam Matthews from the Church of England Pensions Board.