ActionAid, an international non-governmental organization dedicated to combating poverty and injustice globally, has disclosed that fourteen fossil fuel companies generated substantial profits totaling $346.713 billion in a span of 24 months.
The recently released report indicates that these fossil fuel firms accumulated $232 billion in net profits between June 2021 and June 2022, with $155.039 billion considered as profit windfalls. ActionAid operates in 45 countries, collaborating with communities through local partner organizations on various development issues.
According to the report, “In the 12 months leading up to July 2023, the top 14 fossil fuel companies, ranked by market capitalization, collectively earned $278 billion in net profits, marking a staggering 278 percent increase compared to the average from mid-2017 to mid-2021. Out of these $278 billion net profits, $192 billion can be classified as windfall profits, exceeding the average of the preceding four years by over 20 percent.”
The document also reveals that during the same period, the top 22 financial corporations collectively secured $78 billion as profit windfalls.
The report notes that during COP27 in 2022, United Nations Secretary-General Antonio Guterres urged governments to impose taxes on the windfall profits of fossil fuel companies and allocate that revenue to those in need and countries grappling with loss and damage due to climate change impacts.
However, despite this call, the report indicates that only a few European Union member states, the United Kingdom, and some Latin American nations have implemented temporary and often limited windfall taxes on fossil fuel companies. This has resulted in significant profits being undertaxed and climate action remaining underfunded.
In July 2023, joint research by Oxfam and ActionAid unveiled that 722 mega-corporations amassed $1 trillion annually in windfall profits during 2021 and 2022. The research estimated that a 90 percent windfall tax on these profits could generate $941 billion, funds that could enhance global investment in clean energy by a third.