Nov 24, 2010 - 1:00am
The Climate Advocacy Fund’s campaign to have major polluters disclose their emissions has stepped up a gear with complaints to regulators and the development of a legal case, Australian Ethical Investment and The Climate Institute said today.
“We are disappointed that the boards of Paladin Energy and Aquila Resources have rejected Australia’s first climate change shareholder resolutions and we will be considering legal and regulatory options, as well as preparing further resolutions,” said Julian Poulter, The Climate Institute’s Business Director.
“These resolutions ask fundamental questions about emissions disclosure via the Carbon Disclosure Project and it is remarkable that these boards, whose companies will be greatly exposed to carbon regulation, consider reporting to shareholders on their climate change strategies outside of shareholder business.
“At a time when leading companies are designing competitive strategies to thrive in a low carbon world, this is strange behaviour from the boards of Paladin and Aquila when the purpose of the resolutions is to help protect shareholder long-term returns.”
The Climate Institute has lodged a complaint to regulator Australian Securities and Investments Commission (ASIC) ahead of Paladin Energy’s AGM today (Thursday).
"Phil Vernon, CEO of Australian Ethical, said: "The reactions from the boards of Paladin Energy and Aquila Resources were not unexpected but we're in this for the long haul.
“There is an important point of principle to be resolved here and it is likely that similar resolutions will be lodged with these companies next year.
“These types of resolutions are commonplace in the US and shareholders are better off for it. We would like to see a similar regime and culture evolve in Australia.
“We would like ASIC to consider the role of the Securities and Exchange Commission in the US which acts as a referee in the dispute between boards and shareholders.”
The resolutions are sponsored by Australian Ethical Investment, on behalf of the Climate Advocacy Fund and supported by The Climate Institute.
The first set of resolutions to four companies request disclosure of a company’s carbon emissions, strategies to reduce emissions, capital investment assumptions around future carbon prices and their use in making long-term investment decisions.
Aquila Resources Board stated in a notice to all shareholders that the subject of the resolution was a matter for management rather than for shareholders.
Paladin Energy’s board letter echoed that of Aquila Resources but went further stating that the proposed resolution (around carbon disclosure) actually impinged on the board’s authority to manage the company.
A third resolution lodged with Oil Search has been accepted for its AGM in May 2011. A fourth resolution is with Woodside Petroleum and they are taking legal advice on the resolution and have committed to responding before their April 2011 AGM.
For further information:
Harriet Binet | Communications Director, The Climate Institute |