Buried deep in the weeds of a proposed federal rule is a piece of bureaucratic jargon that is stirring fears that an outside group with troubling connections could be making decisions that impact America’s defense contractors.
The rule, with the federal ID number of FAR-2021-15, is still in the drafting process, with a report taking the hundreds of comments received into consideration due on July 26.
The rule’s purpose is to “require major Federal suppliers to publicly disclose greenhouse gas emissions and climate-related financial risk and to set science-based reduction targets,” according to a federal procurement website.
The draft version of the rule says that large defense contractors must develop “science-based targets” for reducing greenhouse gases and that “these targets must be validated by SBTi.”
The draft rule then notes that “SBTi is a partnership between CDP, the United Nations Global Compact (UNGC), the World Resources Institute (WRI), and the World Wide Fund for Nature (WWF, also known as the World Wildlife Fund).”
A less glowing report in the Washington Free Beacon claimed that the London-based group “is funded by the Democratic Party’s main dark money network.”
The site alleged that one group managing SBTi is the “We Mean Business Coalition,” which it called “a front group for a $900 million left-leaning dark money organization called the New Venture Fund.”
SBTi’s website lists the We Mean Business Coalition as a partner.
The Free Beacon said the New Venture Fund is on the hot seat over its political activities during the 2020 election year.
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Aside from potential twists and turns of the organization’s money trail, having it in the middle of a federal procurement system irks many.
SBTi would be “operating in a quasi-regulatory stance,” said former SBTI board member Bill Baue, a sustainability expert who is no longer affiliated with the group.
“And yet it doesn’t have the kind of checks and balances or transparency for such an organization … certainly there’s reason to be concerned,” he said, touching on areas such as financial conflicts, ethics issues or proper governance.
BP America filed a comment against the rule saying, “We believe that by appointing a third-party arbiter of companies’ eligibility to be major contractors, the proposed regulation could be damaging and counter-productive, both for the proposal’s underlying decarbonization goals, which bp supports, and for the effectiveness and competitiveness of federal major procurements.”
“By effectively appointing a third-party arbiter to determine which companies are eligible to be major contractors, without the requisite degree of federal government involvement in or oversight,” the statement continued, “we believe that the proposal is
at variance with recommendations of the Administrative Conference of the United States, presenting risks to the integrity and legal durability of the proposal.”
The U.S. Chamber of Commerce poked holes in the plan by noting that another outside group — CDP — would be reviewing company data and plans and being paid in the process.
“Major contractors would have to submit this disclosure by filling out the questionnaire of a private entity — CDP — and by paying CDP thousands of dollars in fees,” its statement said.
“The Proposed Rule would further require major contractors to develop ‘science-based targets’ for reducing GHG emissions in accordance with specific and stringent requirements developed and maintained by a private entity, the Science Based Targets initiative (‘SBTi’) (which is not subject to the legal and political constraints that apply to federal administrative agencies) and to have those targets ‘validated’ by the same entity. All in all, these additional requirements would tack millions of dollars onto each ‘major’ contractor’s total annual compliance spending,” it wrote.
Travis Fisher, a senior energy research fellow at the Heritage Foundation, said the concept is a loser, according to the Washington Free Beacon.
“I think Americans will be upset when they realize the Biden administration is trying to put a bunch of unelected bureaucrats and a climate activist group — headquartered in London — in charge of long-term planning for our national defense contractors,” he said.
