Church joins shareholder revolt against coal lobby

By agency reporter
May 6, 2018

A shareholder resolution focusing on Rio Tinto Limited’s relationship with lobby groups that block climate change policy drew over 18 per cent of the vote at the Annual General Meeting in Melbourne on 2 May 2018. When taking into account abstentions, over 20 per cent of shareholders did not vote with Rio’s management on this issue. This is the largest vote for a shareholder resolution related to climate change, without board support, in Australian corporate history and came despite the opposition of the company board and the main proxy voting advisors.

The resolution was co-filed by the Church of England Pensions Board along with the Australasian Centre for Corporate Responsibility (ACCR), Australian pension fund Local Government Super, and The Seventh Swedish National Pension Fund (AP7). 

Adam Matthews, Head of Engagement for the Church of England Pensions Board said: “This is the largest shareholder revolt against management on the issue of climate change in Australian corporate history. It’s a highly significant vote on an important issue of Rio’s support of trade associations and their negative lobbying to prevent action to address climate change.

“This was a very reasonable resolution that has gathered the support of many shareholders with trillions in assets under management. It justified a better response from Rio’s Board and I would encourage the Chairman to now take the opportunity to commit to undertake the called for review as well as to publish Rio’s funding of trade associations.  It is clear a large element of Rio shareholders would welcome such a step.

“Going forward we will continue to engage with Rio’s board and will work together with the funds that have supported our resolution.  I would also like to pay tribute to the partnership we have developed with the co-filers LGS, ACCR, AP7 as well as the support we have had from Client Earth and ShareAction.”

ClientEarth climate lawyer Sophie Marjanac said, “This vote is a watershed moment in Australian corporate governance and it will have hit home with boards across the sector.

“Shareholders with a significant financial stake in Rio Tinto Ltd have said loud and clear that they understand and care about climate lobbying. They have demanded that the company address the risks that climate obstructionist organisations like the Minerals Council of Australia pose to their business.

“We expect more investors to take companies to task over this issue and drive them to start delivering on the Paris Agreement.”

*  Client Earth works to protect the environment through advocacy, litigation and science https://www.clientearth.org/

* Church of England https://www.churchofengland.org/

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