BHP pressed on coal activities

By Tony Levene

Coal Miner under increasing investor pressure


Miner BHP is under increasing pressure to alter its climate change stance. And this is unlikely to go away whatever the group’s annual general meeting votes.

Activist investors have long realised that it is the resolution itself, not the vote result, that counts. And while the miner can rely on a majority of voting shareholders to throw out attempts to force the board, dissidents know that once an idea is out in the open, it cannot easily be forgotten or ignored.

UK investment giant Aberdeen Standard Investments is supporting a resolution which attacks BHP for climate change lobbying activities undertaken by industry associations where it is a member. Aberdeen is a top five shareholder with 3.2 per cent of the mining company’s shares held on behalf of individual investors. It expects to lose the battle but eventually win the war.

Over the past month, BHP shares have slumped from £1,795 to £1,618.

The Aberdeen line is diplomatically emollient. It says: "BHP has and continues to show leadership in many areas of climate change. This leadership needs to extend to effective oversight of all its lobbying and advocacy activities, including if necessary temporary suspension of industry group memberships, to ensure full alignment with BHP's stated commitment to the goals of the Paris climate change agreement and the transition to a net zero carbon economy. Failure to implement effective governance of its industry group lobbying activities serves to undermine the integrity of BHP's climate leadership position and causes damage to its reputation.”

BHP has not commented. But many investors in its native Australia are in favour of coal mining activities. In particular, the Minerals Council of Australia has repeatedly called for coal-friendly policies.

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