Toyota's Climate Policy Engagement

An InfluenceMap Assessment of its Dec 2021 Disclosure + Update on its Climate Policy Engagement Score

January 2022

About this Briefing

This investor briefing has been prepared by InfluenceMap following release on December 28, 2021 by Toyota of its Climate Policy Engagement Review, which may be found at this PDF download.

We present a summary in the text box below of Toyota's current policy engagement followed by a summary of our assessment of its Dec 28th disclosure. The full report of the latter is available for download at the left.

All source materials for the evidence quoted below can be found on InfluenceMap’s online profiles for Toyota, its industry associations and other major automotive companies. Links to these profiles can be found either in the text below, or in the documents available for download.

We also include a download document showing Toyota's policy engagement within its sector and current and projected EV production 2022-28 by the sector based on IHS Markit data from December 2021. Kindly do not share this URL beyond your organization.

Toyota's profile on the site is here.

Toyota's Climate Policy Engagement, Latest as of Feb 2022

Toyota scores D on InfluenceMap's system assessing direct and indirect corporate influence on climate policy, the second lowest score of any automaker. Toyota has advocated for the following policy and technology outcomes.

  • Toyota has consistently opposed national policies to phase out ICE vehicles globally. This includes advocating in 2020-21 against policies to phase out ICE vehicles in the US, Japan, UK and New Zealand. Toyota also refused to sign a global pledge at COP26 to phase out ICE-powered vehicles in leading markets by 2035 and globally by 2040.

  • Toyota has consistently promoted a long-term role for hybrid vehicles in the transport sector over policies promoting battery electric vehicles, including in a 2020 presentation to the Japanese government, and 2021 testimony to the US Senate. Furthermore, December 2021 Japanese media reports suggest Toyota has disseminated books criticizing EVs to the Japanese media and government, and organized meetings with the Japanese media to discourage reporters from writing positively about EVs.

  • Toyota appears to have mixed engagement with higher GHG emissions standards for vehicles in numerous global markets. In the US, Toyota in 2021 has supported a mid-range proposal for 2023-26 GHG emissions standards for vehicles, in between Trump and Obama-era standards, while opposing the high-range proposed standards, alongside advocating for numerous flexibilities to weaken the stringency of the regulation. In 2021, Toyota also opposed higher government-proposed GHG emissions standards for light-duty vehicles in New Zealand.

  • Regarding Japanese energy and GHG emissions legislation, Toyota in 2020-21 appears to have mixed engagement, appearing supportive of some measures to promote renewables and decarbonize power, while at other times emphasizing the costs of such a transition. Toyota’s CEO in 2021 further appeared unsupportive of increased Japanese GHG emissions targets before COP26, suggesting they are “not based on the reality of Japan”.

Full profile on Toyota's policy influence can be found here.

Toyota's Dec 28th, 2021 Review, An IM Assessment

A central ask of CA100+ target companies from the investor community has been to audit and publish reviews of their industry associations’ climate policy engagement and alignment. In response to increasing investor interest in this area, InfluenceMap has developed a methodology, benchmarked against investor expectations outlined by the PRI, IIGCC, and CERES, to assess the quality of these reviews.

Under this process, Toyota received a Review Score of 36/100, which falls considerably short of investor expectations and its industry peers in such disclosures to date. See how this compares with our scoring of other disclosures using the same process.

• Toyota has disclosed some information on its own climate policy positions and influencing activities, and those of its industry associations. However, Toyota does not disclose a position on key policies which are material to its operations, and overlooks examples of negative climate policy engagement by the associations included in the review.

• Toyota has not clearly explained the governance processes in place to ensure alignment on climate policy engagement. For instance, the framework to address potential cases of misalignment does not include escalation steps or clear deadlines for industry associations which do not amend misaligned practices.

• As a result of the above, Toyota has failed to identify and take action on key industry associations which InfluenceMap analysis finds have climate policy engagement practices misaligned with the goals of the Paris Agreement, namely: Japan Automobile Manufacturers Association (JAMA), Japan Business Federation (Keidanren), Alliance for Automotive Innovation (Auto Innovators), and European Automobile Manufacturers’ Association (ACEA).

• In the EU, ACEA has led lobbying efforts against a zero-emissions 2035 CO2 target for light duty vehicles in 2021. In the US, Auto Innovators in 2021 opposed the higher-range GHG emissions standards for light duty vehicles, supporting only a weaker mid-range option with numerous flexibilities. In Japan, JAMA’s support for the 2030 target appears conditional on low cost and preferential incentives for industrial users. JAMA also appeared to advocate for weaker GHG emissions standards for light duty vehicles in Japan in April 2021. Keidanren opposed carbon taxes and emissions trading, promoting the weaker voluntary credit market instead.

The Auto Sector: Lobbying & BEV Rollout to 2028

We include a second download document ("Auto Sector Policy Engagement and EV Outlook"). This shows Toyota's policy engagement within its sector and current and projected EV production 2022-28 by the sector based on December 2021 IHS Markit data, alongside the climate policy engagement scores for Toyota's key industry associations. While this data uses recent IHS Markit data, it may not fully account for the December 2021 BEV announcement by Toyota.