BP Plc’s exit from Russia may cause tens of billions of dollars of financial pain, but it could have a longer-term upside for the company’s environmental credentials. 

Even before Russian troops invaded Ukraine, the Anglo-Russian corporate alliance was coming under fire for being at odds with BP’s vision of a low-carbon future. 

The company pledged in 2020 to slash its greenhouse gas emissions and shrink fossil fuel production by 40% by 2030. But Rosneft, which remains staunchly committed to oil and gas, didn’t factor into these calculations, raising questions about their veracity. 

“BP’s climate ambitions and targets explicitly exclude Rosneft, which was a major bone of contention for ESG investors,” Bernstein analysts including Oswald Clint wrote in a research note on Sunday. “As such, BP’s ESG credentials will markedly improve” once it gets out of Russia. 

Before the invasion, Chief Executive Officer Bernard Looney had defended BP’s stake in Rosneft, saying it was better to have a seat at the table. He even went as far as saying that the Rosneft was “a company that gets it” on the issue of climate change and had a lower greenhouse gas intensity per barrel than BP’s own production. 

Not everyone was convinced.

“From a climate perspective, we don’t think BP had sufficient control at Rosneft to materially reduce its emissions,” said Shu Ling Liauw, lead analyst at Global Climate Insights, which is an an initiative of shareholder advocacy group the Australasian Centre for Corporate Responsibility.

Once the exit from Rosneft is complete, BP’s ESG “perceptional rating” could improve, said JPMorgan Chase & Co.’s Managing Director of Global Energy Christyan Malek. While a forced exit from Rosneft isn’t ideal, this new image could offset the biannual dividend the company received from Rosneft. 

“Yes, you have less earnings power, but your cost of equity has gone down,” Malek said.  

Still, when it comes to the volume of greenhouse gases that are emitted into the atmosphere, there’s no benefit to the world. Just last week, former BP boss John Browne—who first brought the company into Russia in the 1990s—warned against simplistic actions like divestment as a way to promote clean energy.  

“It makes very little difference to global climate,” Browne said.