Shareholder climate change resolutions rejected Media Release

Nov 05, 2010 - 2:30pm

The boards of two resource companies have rejected Australia’s first climate change shareholder resolutions for consideration, preventing shareholders from voting on the resolutions at the AGMs, The Climate Institute and Australian Ethical Investment said today.

Australian-listed Paladin Energy and Aquila Resources believe that the climate change resolutions were management and not shareholder business and on that basis have refused the request to put the resolutions on their November AGMs’ Notice of Meeting.

“It is disappointing and surprising that the Paladin and Aquila boards are censoring these proposed expressions of shareholder interests when the purpose of the resolutions is to help protect shareholder long-term returns,” said Julian Poulter, The Climate Institute’s Business Director.

“These resolutions ask fundamental questions about emissions disclosure 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.”

However, both companies have distributed the statements proposing the resolutions to all their 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 Board’s view, is that the subject matter of the proposed resolution, both under the Company’s Constitution and under the Corporations Act 2001 (Cwlth), is 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. Woodside Petroleum is taking legal advice on the resolution and has committed to responding before their April 2011 AGM.

James Thier, Australian Ethical Investment Director, said: “Clearly there is some inconsistency here. Oil Search to its credit has acknowledged the issues within the resolution and presumably will come to the meeting with some information for shareholders.

“Oil Search’s response, together with other regulatory developments all over the world put the Aquila and Paladin responses into context.”

For further information: 
Julian Poulter | Business Director, The Climate Institute |  0402 488 877 
Harriet Binet | Communications Director, The Climate Institute |  02 8239 6299 or  0402 588 384

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