30 October 2018
Our latest Market Forces Investing in the Dark research shines a spotlight on companies actively managing climate risk, and those lagging behind.
Cue Energy is a stand out for not taking climate change and its risks seriously. The oil and gas exploration company doesn’t make it clear if it even supports the science of climate change. According to Cue’s 2018 annual report it:
- doesn’t classify climate risk as a material business risk
- doesn’t discuss the risks associated with climate change
- doesn’t have emissions reductions plan or any emission reduction targets.
For an exploration company with oil and gas fields in Australia, New Zealand and south-east Asia, it seems foolhardy not to provide such information. According to a recent Oil Change report, oil and gas production alone will burst our carbon budget for a 50% chance of keeping global warming to below 2ºC.
At Cue Energy’s AGM today in Melbourne a shareholder asked if the company’s auditor had considered climate risk as material in its 2018 financial report.“‘There is no provisions to account for climate risk as such,” responded the auditor.
The shareholder asked the board how it had concluded that climate change poses no material financial risks to the company.
“I think if you have a look at the timeframe at which we’re looking at… my personal view is that gas is more of a transitional commodity moving forward,” said chairman Alastair McGregor. “There is more and more gas development when you move into cleaner fuel….with that as the backdrop I think it’s fair to say we are comfortable with the risk.”
On the question of whether Cue Energy’s board supports the Paris climate change agreement, Alastair McGregor replied:
“Let’s take the bigger picture of climate change. Climate change is not going to be depicted by one individual company in their own right. It’s more a national view and an international view of how we manage energy around the world. As I’ve already said the way I look at this gas is much more of a transitional commodity… so I think it’s fair to say that having much more of a gas focus is a move in that general direction.”
Companies should be doing more to disclose their risks to climate. Write to your superfund and ask them to enforce climate risk management.