pennsylvania
Credit: Kristina Marusic for EHN
Nippon Steel shareholders demand environmental accountability in light of pending U.S. Steel acquisition
Nippon Steel, the largest steel producer in Japan and the fourth-largest in the world, is set to purchase U.S. Steel pending regulatory approval by the US government. The sale is controversial because the United Steelworkers Union strongly opposes it, and has sparked an international political debate over whether U.S. Steel should remain “American owned.”
Meanwhile, experts say both Nippon Steel and U.S. Steel have fallen behind competitors when it comes to green steelmaking, and communities living near U.S. Steel’s polluting, coal-based manufacturing sites in places like western Pennsylvania say their concerns about health harms have been ignored in the debate about the sale.
A group of concerned investors say that Nippon Steel’s purchase of U.S. Steel, which still relies heavily on coal-based steel production at its 11 blast furnaces in the Pittsburgh region, is part of a pattern indicating the company has a “coal addiction.” Nippon Steel has also been buying up coal mines in other parts of the world, and recently started construction on two new blast furnaces in India.
“Steel does not have a climate problem, it has a coal problem,” Brynn O’Brien, executive director of the Australasian Centre for Corporate Responsibility, one of the investment groups calling for changes at Nippon Steel, told EHN. “Shareholders should note neither U.S. Steel nor Nippon Steel have Paris-aligned targets, and the potential addition of U.S. Steel’s 11 blast furnaces to Nippon Steel’s operations will place more pressure on the company to demonstrate to shareholders it has a credible decarbonization strategy.”
O’Brien’s organization, along with the investment groups Corporate Action Japan and Legal & General Investment Management, filed three shareholder proposals ahead of last Friday’s meeting. The proposals asked Nippon Steel to set and disclose short and medium-term greenhouse gas emissions reduction targets aligned with the Paris Agreement, requested that executive profits be linked to the company’s emissions reduction targets (something other steel companies have already done) and asked for increased disclosure of climate-related lobbying activities.
When the proposals were presented at last Friday’s shareholder meeting, they were met with applause from other shareholders, according to people who were present.
“I think that’s a sign of the times that there’s increasing awareness that Nippon Steel has a climate problem it needs to get serious about, and that’s the message these investors sent,” Roger Smith, Asia lead for SteelWatch, an industry watchdog and climate advocacy group, told EHN.
The filing of the proposals came after a group of institutional investors collectively representing nearly $5 trillion of assets informally asked Nippon Steel for more environmental accountability last year, according to the Australasian Centre for Corporate Responsibility. The formal proposals were also supported by the large institutional investment firms Amundi, Nordea Asset Management and Storebrand Asset Management.
“Steel does not have a climate problem, it has a coal problem." — Brynn O’Brien, Australasian Centre for Corporate Responsibility
The proposals didn’t garner enough votes to be adopted at last Friday’s shareholder meeting, but about 21% of shareholders voted in support of the proposal to align emission goals with the Paris Agreement, 23% of shareholders voted in support of the proposal requesting that shareholder profits be linked to the company’s emission reduction targets and 28% of shareholders voted in favor of the proposal on improved disclosure of climate-related lobbying.
In Japan, climate-related shareholder proposals require a majority of two-thirds of the votes of the shareholders present in order to be adopted, according to O’Brien.
“Not meeting this threshold does not mean a company can or will disregard significant support for a proposal,” he said. “Given the significant shareholder support for all three proposals, we expect Nippon Steel to respond to this strong investor feedback… Good corporate governance requires, at a minimum, the company to analyze the reasons for the vote and consider how its strategy needs to evolve in line with investor expectations.”
Nippon Steel did not immediately respond to a request for comment on the shareholder proposals or its decarbonization strategy.
A competitive disadvantage
While the shareholders who filed the proposals raised climate and public health concerns, their primary concern was financial.
The support for the climate-related proposals at the shareholders meeting “is evidence that investors see a strong link between a credible decarbonization strategy and securing corporate value,” O’Brien said. “Continuing coal investment risks stranded assets, regulatory penalties and competitive disadvantages as global markets shift towards green steel production.”
The Paris Agreement has shifted the steel market dramatically, Smith said.
“It’s now the expectation of governments and steel buyers that low-emission steel will soon be available, and ultimately that will either be requested or required,” Smith said. “Some of Nippon Steel’s biggest rivals have plans to produce green steel in the next few years, but Nippon Steel has nothing to compete with that. They have no low-emissions primary steel, nor do they have any plans to produce it in the near future.”
O’Brien noted that while U.S. Steel’s Pennsylvania plants are problematic, Nippon Steel’s decarbonization strategy would benefit from acquiring the company’s electric arc furnace facilities in Alabama, which have a significantly lower carbon footprint and are necessary for the production of green steel.
“That doesn’t resolve shareholder concerns about making continued investments in coal-based facilities,” Smith said. “Investors need to know, is this just a dead end? Are you just going to run the blast furnaces into the ground and then walk away?”
The steel industry’s critical role in meeting global climate targets
“I don’t think they’re going to care about us," Natalie Morris, a resident of Braddock who lives near U.S. Steel’s Edgar Thomson Mill, told EHN during a protest last month over the sale to Nippon Steel.
Credit: Kristina Marusic for EHNSteel production is responsible for an estimated 7% of all human-made greenhouse gas emissions, and is the largest greenhouse gas emitter in the manufacturing sector. The steel industry’s carbon footprint impacts other major industries, including construction, transportation and energy production, so shrinking the industry’s emissions could also “substantially cut emissions for all those industries dependent on steel,” according to the World Economic Forum.
Both U.S. Steel and Nippon Steel have set goals of being carbon neutral by 2050, but both companies have been criticized for lacking concrete plans to reach that goal, for their continued reliance on coal when cleaner technologies are available and for that timeline being too slow to achieve the 1.5°C global warming limit established by the Paris Climate Agreement.
The MSCI Global Sustainability Index rates Nippon Steel’s projected emissions as being aligned with more than 3.2°C of global warming, indicating that the company’s “contribution to catastrophic climate change is higher than most.”
“It wouldn’t be a livable planet if every company did that,” Smith told EHN.
U.S. Steel doesn’t have an MSCI rating, but has been ranked “high risk” for investors concerned about sustainability by the investment research firm Morningstar.
“It’s a little ironic that Nippon Steel is coming to the U.S. and buying a company that’s facing all the same problems they’re facing in Japan,” Smith said.
The shareholders plan to continue applying pressure.
“There are further escalation tools available to shareholders, including voting on directors, if insufficient progress is made,” O’Brien said. “Investors want confidence that Nippon Steel is going to remain competitive into the future, and there is strong commitment to ensuring corporate value is secured.”
Credit: Kristina Marusic for EHN
Environmental justice advocates find hope, healing and community in Pittsburgh
May is Mental Health Awareness Month, and the Environmental Justice Summit highlighted the need for self-care and connection among researchers and advocates working to advance justice. Exposure to pollution and anxiety about climate change can negatively impact mental health and people who work to right injustices face the risk of compassion fatigue and burnout.
The summit was conceived and organized by Tina Ndoh, associate professor of environmental and occupational health at Pitt's School of Public Health, and Dani Wilson, executive director of the Cancer & Environment Network of southwestern Pennsylvania.
“Advancing justice is emotionally difficult work,” Wilson told EHN. “Taking care of ourselves and each other is critical to fostering moments of joy and connection that help us stay in the movement.”
Over three days, attendees strategized about how to advance environmental justice in the greater Pittsburgh region and how to foster resilience with tools like meditation, storytelling, community-building, yoga, crafting and cooking. The event also highlighted the importance of humor, connection and optimism.
“This is a social movement,” said Jamil Bey, founder of the nonprofit think tank UrbanKind Institute and newly-appointed director of the Department of City Planning for Pittsburgh. “That means that as part of this work, we’ve gotta have fun with our friends. We’ve gotta stay connected and be able to laugh.”
On Friday, Dr. Sacoby Wilson, an environmental health scientist, professor and director of the Center for Community Engagement, Environmental Justice and Health at the University of Maryland, set the tone for the day by declaring himself a “hardcore Steelers fan” and waving a Terrible Towel above his head while shouting “Go Steelers!”
Dr. Sacoby Wilson, an environmental health scientist, professor and director of the Center for Community Engagement, Environmental Justice and Health at the University of Maryland, waves a terrible towel at the EJ Summit Pittsburgh.
Credit: John Altdorfer, courtesy of the Cancer and Environment Network of SWPA
Wilson peppered an otherwise serious talk about the ravages of environmental racism and his work developing tools to combat it with football jokes, referencing recent quarterback drama (“two quarterbacks are better than one!”), emphasizing the importance of both offense and defense for communities burdened by pollution and quipping that if we want to score a touchdown, the community needs to work as a team.
“Where you live can kill you,” Wilson said, noting that poor, Black and Brown neighborhoods in most places, including southwestern Pennsylvania, face higher levels of exposure to pollution that result in worse health outcomes and lowered life expectancy. These places are also more likely to experience the impacts of climate change and other disproportionate harms.
“We need a holistic framework for environmental justice that also acknowledges the need for housing justice, economic justice, social justice, educational justice, reproductive justice and racial justice,” he said, “because these things are all connected. And you can’t get equity without justice… And on a separate note, we’re going to the Super Bowl this year, right?”
Environmental justice victories
EJ Summit attendees show off their artwork.
Credit: Stephanie Ciranni, Cancer Bridges
Other speakers shared recent victories and progress.
Professor Tiffany Gary-Webb, the associate dean for Diversity, Equity and Inclusion at the University of Pittsburgh School of Public Health, shared the results of her work with the Black Environmental Collective and the Black Equity Coalition. The group formed in April 2020 to ensure an equitable response to the COVID-19 pandemic in Pittsburgh and has evolved to continue advancing racial equity in western Pennsylvania.
“We used data to try and understand where there were higher rates of COVID and sent those to the county and state health departments. We talked to elected officials and put out our own dashboard with the numbers for Black populations, and through those efforts we were able to get critical resources to our communities and see that data change,” Gary-Webb said, pointing to a study that summarized the group’s effectiveness. “Now we’re continuing that work with a focus on other issues in our communities.”
Ash Chan, a farmer and steward at Oasis Farm and Fishery, shared their experience working at a Black-owned garden and market in Pittsburgh’s predominantly Black, working-class Homewood neighborhood, which has a long history of disinvestment and has been without a grocery store since 1994. The organization uses vacant land to grow food and offers classes in urban farming and healthy cooking.
“We see food as a driver of social and economic capital, as well as a way that connects people to their cultural roots and their natural environment,” Chan said. “We’re growing what folks want. For example, last year we noticed that elders in the community would line up for okra before we even opened our farmer’s market …so this year we’re growing six different kinds of okra based on that demand.”
Bearing witness to injustice
Kayien Conner (left) and Melanie Meade (right) at the EJ Summit.
Credit: John Altdorfer, Cancer and Environment Network of SWPA
While the Summit highlighted progress and promoted resilience, it also emphasized “bearing witness” — a process described by event organizers as actively listening, not looking away, and most importantly, responding — to “the slow violence of environmental degradation on our land.”
Participants were invited to attend a “bearing witness ceremony” in Clairton, a small town about 30 miles south of Pittsburgh that regularly sees some of the most polluted air in the country due to emissions from a coal-based U.S. Steel plant.
“The injustices are very thick and very brutal in Clairton,” said Melanie Meade, a clean air activist and resident of Clairton. Meade shared the heartbreak she has experienced learning that Clairton’s rate of childhood asthma is more than double the national rate, watching many loved ones die of cancer and witnessing the impacts of poverty and violence. “The people are tired and they are sick and they are in great need, and we need to stand in the way for them.”
Later in the day, Kayien Conner, a professor at the University of Pittsburgh’s School of Social Work, told Melanie she’d been moved by her words and asked if she could connect her with an organization she’s involved with that offers mental health resources for Black communities to get additional resources to Clairton.
“Yes, please, thank you!” Melanie said.
“See? We’re here making connections, collaborating, getting this work done already!” Wilson shouted to applause and laughter.
Political optimism
Bearing witness ceremony in Clairton, Pennsylvania.
Credit: Dani Wilson
Speakers at the symposium also noted that western Pennsylvania is on the precipice of major political changes that offer many reasons for optimism for environmental advocates, pointing to the election of progressive politicians like Summer Lee and Lindsay Powell and county executive Sara Innamorato, all of whom have pledged to prioritize environmental justice.
“We’re really shaking things up politically right now,” said Bey. “If we don’t do this now, then that’s on us. Now is the time. Let’s keep lifting each other up, let’s do our work and let’s get this done.”
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