A comfortable majority, 55.13% to be precise, of AGL shareholders have voted in favour of resolution from shareholder advocacy organisation the Australasian Centre for Corporate Responsibility (ACCR) calling for AGL to adopt Paris-aligned targets.
It was the biggest vote ever recorded for a climate-focused shareholder push in corporate Australia without board support, according to Ashjayeen Sharif, a climate activist who sought but didn’t succeed in being elected to the company’s board during the same meeting.
This is an incredibly momentous event in the history of climate in Australia. Wow. Wow.
👏🏻 @brynnobrien and @AustCCR team on their @AGLAustralia resolution.
You put a dent in the future timeline of the world today. https://t.co/0HH6WeslLp
— Mike Cannon-Brookes 👨🏼💻🧢🇦🇺 (@mcannonbrookes) September 22, 2021
AGL Energy is Australia’s biggest coal fire generator and greenhouse gas emitter, accounting for roughly 8% of the country’s emissions. In July, it agreed to give its shareholders a vote on climate reporting for after enduring heated criticism over its plan to separate into two entities, the “green” and forward-facing AGL Australia and Accel Energy, which would retain the company’s fossil fuel assets.
Executive Director of the ACCR, Brynn O’Brien, described corporate greenwashing like AGL’s rather transparent ploy to distance itself from its climate notoriety, as “a massive issue” in Australia.
“It’s part of the machinery of delay,” O’Brien told pv magazine Australia.
In a momentous victory which was presumably unexpected for the company, AGL shareholders voted for both of the businesses entities to set targets which align with the Paris-agreement to keep global warming below 1.5°C.
ACCR’s resolution includes that AGL’s board disclose:
- Short, medium and long-term targets for reductions in the proposed demerged companies’ Scope 1, 2 and 3 emissions, aligning with the Paris Agreement;
- Details of how the proposed demerged companies’ capital expenditure will align with the targets;
- Details of how the proposed demerged companies’ remuneration policies will incentivise progress against the targets.
Watch the business end of the #AGLAGM. The big reveal of a majority vote for our #ESG shareholder resolution to $AGL on Paris-aligned targets. pic.twitter.com/fUgmJZVA7Y
— Australasian Centre for Corporate Responsibility (@AustCCR) September 22, 2021
Somewhat confusingly, AGL has since released a statement saying resolution 6(b), the setting of Paris-aligned targets, was an “advisory resolution” which could only be considered if resolution 6(a), titled “amendment to the constitution”, was passed – which it wasn’t. It appears this would mean that despite obtaining majority support from shareholders, the company won’t be obliged to take action, though clarification has been sought.
A spokesperson for AGL told pv magazine Australia: “[it] did not believe this resolution is in the best interests of AGL’s shareholders.”
AGL’s terror year
AGL’s share price has plunged to 20-year lows as the company battles with collapsing electricity prices, the widely-criticised demerger scheme, the shock loss of its CEO, and mounting climate pressure.
“The erosion in shareholder value appears to have finally united shareholders behind this push,” the ACCR’s Director of Climate & Environment, Dan Gocher, said in a statement on the win.
“AGL Chair Peter Botten’s claim that AGL cannot set Paris-aligned targets unilaterally is nonsense. Botten claimed the board is trying “to create a glide path rather than a crash landing,” which ignores the crash that AGL shareholders have already experienced.
“AGL’s claim that it is not in position to commit to develop the necessary replacement capacity for its coal-fired power stations doesn’t stack up. 10-15 years is ample time to develop the replacement capacity with renewable energy and storage,” Gocher added.
Presumably, the company will now have to take some type of climate action – and ACCR will no doubt be keenly watching. Just yesterday, the organisation had its first day in federal court with oil and gas giant Santos, which the ACCR alleges does not have a credible pathway to its net zero by 2040 target, effectively amounting to deceptive conduct under Australian consumer law.
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