BHP's London AGM rejects call to quit mining associations
BHP has been one of the industry leaders in facing the challenges of climate change, going as far as committing $400 million to a climate investment program to develop technologies to reduce carbon emissions. However, its shareholders were poised to reject a motion that would have the company suspend its membership in industry groups that have been judged to be at odds with goals to tackle climate change.
Those in favor of suspending the membership argue that industry groups can fund pro-coal lobbying. Aberdeen Standard Investments, one of the largest shareholders of BHP, is among the groups in favor of the suspension. It said that such lobbying groups can be an obstacle to positive change.
However, Reuters reported that at the London annual general meeting, which represents 42 percent of shareholders, only 22.16 percent of votes supported the motion to suspend membership of trade associations that are not lobbying in line with the Paris Climate Agreement.
The ballot will be followed by another vote on Nov. 7, representing the remaining 58 percent, in Australia, where there is strong support for coal as a provider of jobs and wealth.
For its part, BHP executives said the membership in industry bodies gives the company a voice and that the groups can be used to push for positive change.
“Climate change is a complex problem. If we’re going to develop successful solutions, we need to collaborate,” Chairman Ken MacKenzie told reporters.
But non-governmental organization the Australasian Centre for Corporate Responsibility (ACCR) urged BHP to reconsider its position ahead of the Australian vote.
BHP has pledged to invest $400 million over five years to reduce emissions and to tackle the huge amount of pollution caused when customers use its products, notably coking coal and iron ore to make steel.
“Climate change is a global challenge that requires a collaborative market and policy response. Playing our part in responding to climate change is a priority governance and strategic issue for BHP. Our board is actively engaged in the governance of climate change issues, supported by the Sustainability Committee. Management has primary responsibility for the design and implementation of our climate change strategy,” BHP says on its website. “Our climate change strategy focuses on reducing our operational greenhouse gas (GHG) emissions, investing in low emissions technologies, promoting product stewardship, managing climate-related risk and opportunity, and working with others to enhance the global policy and market response.”
It says steel and other minerals it produces are essential to the roll out of cleaner technology and justifies its continued investment in fossil fuel on the grounds transition has to be gradual.
CEO Andrew Mackenzie said industry projections showed “continued use and growth in the use of oil and coal well into the 2030s”.
“You can’t suddenly lurch from running a fossil fuel world to a world that’s fully based on renewables without causing incredible disruption both to the reliability of energy and its cost,” he said.
Photo: BHP, Newman Western Australia, @BHP