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Transition to EVs Needs Worker, Climate Safeguards, Says Panel

Companies face pressure from investors on environmental, social and corporate governance matters as automakers charge ahead on EV rollout and work to ensure battery minerals supply


transition to EVs
Renault, also Nissan's top shareholder, is playing catch-up in the shift to electric vehicles led by US rival Tesla. Photo: Reuters.

 

Automotive manufacturers need to take into account their communities and workers through greater environmental protections and higher pay in the transition to electric vehicles, a panel of investors, labour officials and human rights activists said on Wednesday.

The global auto industry is shifting to EVs in response to pressure from countries and regions such as China and Europe that want to reduce carbon emissions.

Companies also face growing pressure from investors on environmental, social and corporate governance (ESG) matters. Automakers not only are charging ahead on the EV rollout, but also working to ensure a supply of battery minerals.

“Every business will be significantly affected by the transition to a net-zero economy,” Illinois state treasurer Michael Frerichs said at a conference held by the Council of Institutional Investors, a group of public, corporate and union employee benefit funds.

“Companies have a responsibility to their investors … and to their communities and their workers to prepare for this transition,” he added. “We can’t let them bury their heads in the sand and pretend they don’t need to make any changes.”

 

 

Well-Paying Jobs

Part of that push includes well-paying jobs and access to union representation in plants, the speakers said at the event in Washington.

Cindy Estrada, vice president of the United Auto Workers union, which represents most US hourly workers at General Motors, Ford Motor and Stellantis, said the key is protecting worker jobs and wages in the EV transition.

“We could end up doing this transition and lower workplace standards,” she said, citing the numerous EV battery plants coming online in the US.

She said the battery plant workers are expected to be paid about $17 an hour, compared with the $30-plus workers in current engine plants earn.

Tesla CEO Elon Musk earlier this month invited the UAW to hold a vote to represent workers at the EV leader’s California plant. UAW officials have not commented on the invitation, but Musk has been hostile to the union in the past.

In November, 10 advocacy groups, including Sierra Club and Greenpeace, urged EV startup Rivian Automotive to engage with labor unions. Workers at Rivian’s Illinois plant are not unionised.

Investors need to use their leverage with companies to ask tough questions and push for greater transparency, Richard Kent, Amnesty International’s researcher on human rights and energy transition, said.

Wednesday’s panel was hosted by SOC Investment Group, an adviser for union pension funds with more than $250 billion in assets. SOC pressed Rivian last fall on its battery supply chain.

 

  • Reuters with additional editing by Jim Pollard

 

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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years and has a family in Bangkok.

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