Steelmaker ArcelorMittal shirking decarbonisation commitments, report finds
· Marseille, France
ArcelorMittal, the world’s second-largest steelmaker, is failing in its claim to be a leader on climate change, having spent just one third of the USD1.5 billion figure it pledged to invest in decarbonisation over the past three years, according to a new report from advocacy group SteelWatch.
- ArcelorMittal spent just USD500 million on decarbonisation from 2021-2023 – one third of the USD1.5 billion figure it said it would invest
- AM returned USD11 billion to shareholders via buybacks or dividends from 2021-2023, 22 times the amount it spent on decarbonisation
- The company is currently backtracking on plans for green hydrogen-based steelmaking, having already lined up EUR3.5 billion in subsidies
- AM’s share price rose by 61 percent from 2019-2023, boosting the value of shares held by controlling Mittal family by USD2.9 billion to amount to USD9.65 billion
- The company operates 33 coal-based blast furnaces and is responsible for 114.3 million tonnes of CO2 equivalent – comparable to the entire emissions of Belgium or one third of France’s.
Marseille, France, 8 May 2024 – ArcelorMittal, the world’s second-largest steelmaker, is failing in its claim to be a leader on climate change, having spent just one third of the USD1.5 billion figure it pledged to invest in decarbonisation over the past three years, according to a new report from advocacy group SteelWatch.
The industrial giant, which is responsible for the same amount of emissions as Belgium, estimated in 2021 that its decarbonisation progress by 2030 would cost USD10 billion and has already lined up EUR3.5 billion in subsidies to support its transition.
In Spain, the company secured a EUR450 million government grant to develop zero emissions, green hydrogen-based steelmaking. However, it has already watered down these plans, opting to delay the use of green hydrogen in favour of carbon intensive fossil gas, all while apparently clinging on to the subsidy.
Such reliance on state support comes at a time of record shareholder returns. The company has returned USD11 billion to shareholders via buybacks and dividends in the past three years alone.
The primary beneficiary of this buyback programme has been the controlling Mittal family, who saw the value of their shares rise by USD2.9 billion from 2019-2023 to USD9.65 billion.
The net worth of family patriarch Lakshmi Mittal rose to more than USD20 billion as of March of 2024, up from USD12.9 billion at the start of 2020, according to Bloomberg Billionaires index
While ArcelorMittal prioritises shareholder returns and fossil fuel-based steel production over climate action, it consistently presents itself as a green champion, notably as an official sponsor of this year’s Olympic Games in France, where it has provided “low carbon” steel for the Olympic torch.
To highlight this greenwashing, SteelWatch and the Fair Steel Coalition are also launching a new campaign against the company today: Shiny Claims, Dirty Flames (2). The campaign brings together allies from across continents, challenging the company on human rights abuse, pollution of air water and land, and climate change.
Not only is the company underspending on its transition plan, it continues to build new, highly polluting blast furnaces in India via its joint venture with Japan’s Nippon Steel. We assess therefore that the company’s emissions profile in India will therefore be higher in 2030 than today.
ArcelorMittal currently operates 33 coal-based blast furnaces worldwide.
Given its lack of meaningful commitments on climate, it is little surprise the company confirmed in April it did not plan to commit to a science-based climate target to align with 1.5C.
Caroline Ashley, director of SteelWatch:
“ArcelorMittal makes a lot of shiny claims about cleaning up its operations, but it has no right to call itself a climate leader when it secures billions in government subsidies before backtracking on plans to end fossil fuel use. The sheer scale of its global operations means ArcelorMittal has huge power to drive steel decarbonisation in its business, and throughout the rest of the sector. It knows what it has to do, but it hasn’t got the mettle to do it.”
Julia Hovenier, campaigner at BankTrack & the Fair Steel Coalition:
“For every dollar ArcelorMittal puts into decarbonisation, it puts 22 into its shareholders pockets. ArcelorMittal’s spending makes its strategy clear: double down on the dirty flames of fossil-steel to maximise shareholder wealth, regardless of the consequences for people and planet. We need strong action from governments, and financiers to get ArcelorMittal’s investments in line with a just and fossil-free future.”
Ends
For media inquiries, please contact:
Caroline Ashley
Director, SteelWatch (United Kingdom)
[email protected], +44 7947 691 911
Julia Hovenier
Banks and Steel Campaigner (Netherlands)
[email protected], +31 640 371179
Greg McNevin
Communications, SteelWatch (Australia GMT+10)
[email protected], +61 475 247 044
Notes:
- SteelWatch ArcelorMittal Corporate Climate Assessment 2024: https://steelwatch.org/reports/arcelormittal-corporate-climate-assessment-2024/
- Shiny Claims, Dirty Flames (http://shiny.claims) is a campaign organised by an alliance of different organisations, facilitated by the Fair Steel Coalition, and hosted by SteelWatch, calling on ArcelorMittal to:
- Respect human rights, in actions not just words;
- Stop making empty promises and be a real climate champion;
- Invest in future proofing your company, not enriching shareholders;
- Put workers, communities, and our environment first;
- Stop its dirty tricks: be accountable and transparent.
For all media queries, please contact [email protected]