BHP Shareholders Reject Calls to Lobby Government on Climate

Nov 10, 2022 by Bloomberg
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A truck transports minerals inside the Codelco Chuquicamata open pit copper mine near Calama, Chile, on Thursday, Aug. 2, 2018. Protests at the Chuquicamata copper mine in late July were the first labor disruptions in Chile this year, and happened amid calls for a strike from the union at the world's largest mine, BHP Billiton Ltd.'s Escondida. Photographer: Cristobal Olivares/Bloomberg

BHP Group Ltd. shareholders have rejected a resolution calling on the miner to lobby the Australian government on climate change, following a vote at its annual general meeting. 

Only 13% of votes backed the move, which the board opposed, according to a company filing. Shareholders were asked whether BHP should “proactively advocate for Australian policy settings that are consistent with the Paris Agreement’s objective of limiting global warming to 1.5° Celsius.”

The miner’s shareholders also rejected a resolution calling for more detailed scenario modeling in line with a 1.5°C world, with around 19% supporting it. Both resolutions were filed by the Australasian Centre for Corporate Responsibility. 

Chairman Ken MacKenzie said the board had given “careful consideration” to the advocacy resolution and concluded that it was too “ambiguous” and would amount to “overreach”.  BHP “should be advocating where things have relevancy for our business, and we should be advocating where we have impact,” he said at the meeting in Perth. 

Committed to Coal

The miner was “no longer leading and not even following on climate,” ACCR said in a statement. “BHP is Australia’s largest company and it holds immense political power, which it willingly wields on various policy issues. It should be deploying its influence to enhance the probability of a 1.5 degree pathway,” Harriet Kater, climate lead at the ACCR, said in the statement.

BHP sold its oil and gas business to Woodside Energy Group this year, and has promised to close its thermal coal operations in Australia by 2030. It’s adopted a 30% emissions reduction target for its operations by 2030, and wants to get to net zero by mid-century. 

The miner -- which produces iron ore, copper and coal --  believes coal is the only viable option for producing steel for the next few decades. MacKenzie said Thursday that steel was vital to the roll-out of renewable power technologies including wind and solar, and that there was “no known pathway” to zero carbon production. 

Demand for coking coal would be strong for “decades”, but steel-making technologies replacing coal with hydrogen could eventually take over, he said. Chief Executive Mike Henry said Thursday that BHP currently had no “growth capital” allocated to coking coal.

(Updates with official result of votes in first 3 paragraphs.)

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By James Fernyhough

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