14 June 2023
HESTA’s latest climate change report yet again fails to articulate the fund’s expectations of the most climate-damaging companies in its portfolio, including Santos and Woodside.
For all its lofty claims of climate action, HESTA continues to invest in companies hell-bent on expanding the fossil fuel sector, has no clear time-bound demands of these companies to drop their expansion plans, and has no targets that account for the lion’s share of these companies’ climate impact and risk.
Despite updating its 2030 emissions reduction target from 33% to 50% last September, HESTA’s latest climate report trumpets the fact that the fund has met this out-of-date 33% target ahead of schedule. Not only does this demonstrate a lack of climate ambition on the part of HESTA – given that meeting this now obsolete target is offered up as a sign of progress – but it is also a sleight of hand distracting members from the key issue with this report: HESTA has yet again failed to clearly demand an end to the rampant fossil fuel expansion plans of companies like Santos and Woodside.
Worse still, the climate target HESTA is parading around doesn’t account for Scope 3 emissions, which typically make up about 90% of Santos and Woodside’s total emissions! Without including Scope 3 emissions or accounting for fossil fuel reserves in its climate targets, HESTA’s climate strategy falls far short of adequate.
In September 2022, HESTA asked the impossible of Santos and Woodside by requesting they demonstrate how their business plans align with a 1.5°C emissions reduction scenario. However, HESTA neglected to put a deadline to this request. Nine months on, HESTA’s climate report was a golden opportunity for the fund to increase pressure on these companies and outline clear time-bound expectations, but HESTA has yet again failed to demonstrate effective action consistent with its own commitment to net zero by 2050.
Earlier this year, HESTA voted in favour of climate-related shareholder resolutions at Santos and Woodside’s annual general meetings (AGMs) which called for these companies to wind up their fossil fuel expansion plans. The fund also voted against the re-election of some company directors at these companies. While this was a good step forward for the fund, these actions must be backed up with clearly articulated time-bound expectations of Santos and Woodside, and a commitment to next steps from HESTA should the companies fail to meet those expectations.
It’s time for HESTA to step up the pressure on Santos and Woodside. Tell HESTA to make public its demands of these companies and articulate a clear timeline for divestment from them if they continue to pursue new oil and gas projects.
Tell HESTA it’s time to escalate action at Santos and Woodside.