Climate Advocacy Fund – the first year
2 August 2011
Australian Ethical’s Climate Advocacy Fund has achieved some significant milestones in its first year.
Woodside shareholders meeting in April. Photo courtesy James Baird, JustInvest.
For 2010-11 the Climate Advocacy Fund proposed resolutions to four companies requesting disclosure of carbon emissions, strategies to reduce emissions, and capital investment assumptions around future carbon prices and their impact on long-term investment decisions.
The annual general meetings (AGM) of two of these companies, Aquila Resources and Paladin Energy, were held in November 2010. Both companies refused to put the resolutions to a vote at their AGMs. However, after the AGM both companies agreed to publish carbon emission reports.
The AGMs of the other two companies, Oil Search and Woodside Petroleum, were held in April 2011.
Oil Search responded positively to the Climate Advocacy Fund. The resolution was withdrawn before the AGM after Oil Search announced new plans to manage their carbon risk and to publish targets for reducing their greenhouse gas emissions. The positive engagement from Oil Search is a strong lead for other Australian companies to follow.
Woodside Petroleum declined to table the preferred shareholder resolution asking it to disclose its carbon price assumptions. Instead, Woodside obliged the Fund to opt for a second type of resolution that required a change to the company’s constitution and needed 75 per cent of shareholders to support the resolution.
The resolution put to the Woodside AGM on 20 April 2011 was the first climate change shareholder resolution to be voted on at an Australian company AGM. Around 6 per cent of shareholders voted for the resolution.
The Woodside resolution was an opportunity for other super funds to show they walk the talk on climate change.
The Australian Council of Super Investors recommended their members support the resolution, yet only a handful of super funds went on to vote for the resolution. Significantly, some super funds who are signatories to the Carbon Disclosure Project and the UN Principles for Responsible Investment failed to support the resolution.
