Activist investors celebrate after mining giant promises to realign all its lobbying activity, including that done on its behalf by industry associations, with the goals of the Paris Agreement
Anglo American, the South Africa and London based mining giant, has this week promised to overhaul its membership of industry associations to align all its lobbying activity with the goals of the Paris Agreement, in the face of growing concern from powerful investor groups.
Anglo American said it would take action against any “fundamental misalignments” between Anglo American’s policy positions, “including those that support the goals of the Paris climate agreement” and those of an Industry Association is it a member of.
“Anglo American has considered, including with a number of institutional shareholder groups, plans for strengthened governance regarding such memberships,” it said in a statement yesterday.
If industry groups don’t align to the Paris Agreement or other elements of Anglo American policy, the miner said it will try to engage but would be willing to quit the group if no changes are made.
It also said it will update its Code of Conduct and Group Business Integrity Policy to reflect the updated standard for industry associations, and publish a list of all its industry associations, including fees and reason for joining, ahead of its Annual General Meeting in May 2020.
The news was cheered by the European Corporate Climate Lobbying Initiative run by the Institutional Investors Group on Climate Change (IIGCC), which has spent months trying to convince Anglo American to change its stance.
“Following engagement this is a significant statement by Anglo American that shows both good governance of this issue within the company and a commitment to act decisively when they find misalignment in their industry memberships,” said Adam Matthews, co-lead for the IIGCC European Corporate Climate Lobbying Initiative and director for ethics and engagement for the Church of England Pensions Board. “All companies need to adopt such procedures to retain the confidence of their shareholders on this important issue.”
Anglo American is planning to dispose of its coal assets and reduce emissions by 30 per cent by 2030 under chief executive Mark Cutifani, but climate-conscious investors have argued its continuing membership of climate sceptic lobby groups undermined the miner’s own climate initiatives.
The firm’s 2019 audit of industry associations highlighted tangible policy differences on climate change with the World Coal Association and the Minerals Council of Australia.
Stephanie Pfeifer, CEO of the IIGCC, welcomed the news but said Anglo American must now follow through on its promises. “It is important investors see Anglo American follow through by meaningfully putting its commitment into practice,” she said . “Trade bodies must be called to account where they are opposing, impeding or evading the policy required to support decarbonisation and reduce global emissions. The company will have the full support of investors in acting where needed and engagement will continue to ensure they do.”
BHP Biliton and Glencore have already promised to take similar moves to prevent climate sceptic lobbying to take place on their behalf. The investors involved have promised to target all mining companies engaging in obstructive lobbying.