Group blames CEO pay for climate change

A liberal think tank is arguing that high executive salaries at fossil fuel companies are contributing to climate change.

In a Wednesday report, the Institute for Policy Studies says that the pay structures for oil, gas and coal executives leads directly to companies acting against the interests of the environment and of renewable energy.

{mosads}The group examined executive pay at the top 30 fossil fuel companies, finding that the leaders get paid about 9 percent more than the average among S&P 500 companies.

The salaries encourage companies to expand their exploration for more fuels above other concerns, which directly lead to greenhouse gas emissions, the report said.

“Our perverse executive pay system encouraged the recklessness that led to the 2008 financial crisis,” Sarah Anderson, director of the group’s economy project, said in a statement. “These same misplaced incentives are encouraging the recklessness of fossil fuel executives that is putting the entire world at risk.”

Researchers went a step further and argued that not only the climate suffers.

“The short-term incentive system is not only bad for the planet, it’s bad for investors as well,” said Chuck Collins, a scholar with the think tank. “A rational system would encourage global energy leaders to shift investment away from drilling and mining untapped reserves towards renewable energy options.”