Media release: AGL management rejects climate resolution

8 August 2019

AGL’s management today advised shareholders to reject a resolution calling on the company, Australia’s largest greenhouse gas emitter, to reduce emissions in line with the climate goals of the Paris Agreement.

“AGL’s argument against a common sense shareholder resolution appears to reject the science, which tells us Australia needs to phase out coal power by 2030 to meet the climate goals of the Paris Agreement,” said Market Forces Legal Analyst, Will van de Pol.

“AGL’s own investors have demanded the same, with many having called for an end to coal power in OECD countries by 2030.” 

“AGL’s strategy is out of sync with both its climate rhetoric and global action to meet the Paris climate goals. AGL’s unwillingness to coherently articulate how it will manage a Paris-aligned transition is a major financial risk. Market Forces is calling on shareholders to hold the company’s management to account.”

AGL plans to continue running its Bayswater power station to 2035 and its Loy Yang power station until 2048.

“In the last six months Australia’s biggest bank and our two major general insurers have committed to be out of thermal coal by 2030, if not before. As such, AGLs claim it’s being asked to act ‘unilaterally’ lacks all credibility.”

“Shareholders have a right to know whether AGL has a plan to manage its coal fleet against a backdrop of finance drying up and insurance being withdrawn. These market shifts to meet the goals of the Paris Agreement are the very definition of transitional climate risk, which AGL must manage on behalf of its shareholders,” said van de Pol.

Australian signatories to the Global Investor Statement to Governments on Climate Change (see also the accompanying briefing paper) include: AustralianSuper, BTFG, CareSuper, Catholic Super, Cbus, Christian Super, Colonial First State, First State Super, HESTA, IFM Investors, Janus Henderson, LUCRF, Local Government Super, Mercer, Statewide Super, VicSuper, and Vision Super. 

International signatories with significant AGL holdings include: Schroders, Aberdeen Standard Investments, Kempen Capital Management, Pictet Group, and PGGM.

Market Forces is calling on these investors, and all shareholders to support the resolution ahead of September’s AGM. 

“For big investors demanding political action to close coal power by 2030 in wealthy countries, it should be as easy as falling off a log to make the same demand of a company they own. We’re looking forward to widespread investor support for this resolution.”

AGL’s AGM will take place on 19 September 2019 at the International Convention Centre Sydney.

Read the resolution: https://www.marketforces.org.au/wp-content/uploads/2019/07/AGL-2019-Resolutions-with-supporting-statements.pdf

Read AGL’s Notice of 2019 AGM: 

https://www.asx.com.au/asxpdf/20190808/pdf/4479nq0yhmm9rs.pdf