2 November 2017
Last financial year, Boral Ltd spent around $300 million on energy and emitted 2.5 million tonnes of CO2 equivalent. So far this financial year the company has suffered losses of up to $10m due to the impacts of hurricanes in the US, which were exacerbated by climate change. But Boral doesn’t think climate change poses a significant risk to its business…
At the company’s Annual General Meeting (AGM) today in Sydney, shareholders pressed Boral’s board on important environmental issues, revealing a staggering lack of climate risk management and also a failure to rule out helping Adani deliver on their mega coal mine plans.
Ties to the Adani Carmichael Mine?
Adani’s Carmichael mine is one of the most contentious issues in politics at the moment. Given 77% of Australians who know about the mine oppose it, shareholders were rightly worried about their company being involved in such a risky, damaging project. One shareholder brought to the attention of the meeting a 2016 document in which Boral considered the mine a possible project in its ‘Positive Long-term Project Pipeline.’ The board responded by admitting that, whilst they were not actively pursuing the project, they could not rule out working with Adani on the mine.
No timeframe for responsible practices
Boral has previously considered the Task Force on Financial Related Climate Disclosures (TCFD) recommendations, but has never pledged to implement them. A concerned shareholder asked the company if and when investors could expect to see TCFD reporting, but was only told the company would look at them ‘in the future,’ with no clear timeframe for implementation.
As a major energy user, Boral is hugely exposed to the transition risks posed by climate change, such as potential carbon pricing. Its operations also face heightened risk due to the physical impacts of climate change, including extreme weather events, sea level rise and storm surges. The fact that a company so heavily exposed to climate risk is unwilling to explain to investors how it is managing that risk is extremely worrying, and seems to fly in the face of guidance from regulators and lawyers.
Boral has so far failed to set time-specific energy efficiency and greenhouse gas emissions targets. When a shareholder asked the board if and when Boral would be doing so, the answer was a resounding ‘No’ from CEO Mike Kane, watch below.
Boral’s climate and environmental policies and practices don’t stack up. The building materials group needs to step up its game both at home and abroad if it is to be taken seriously on its approach to climate change. Measures such as setting emissions reduction targets and implementing the TCFD recommendations are desperately needed first steps.