15 November 2017
Today shareholders asked Senex about whether it has plans to transition to lower carbon emitting activities in line with the two degree Paris climate commitments. In short, the answer was no. Senex Energy is an Australian energy company listed on the ASX which engages in oil and gas exploration and production in Queensland and South Australia.
Failing on climate
When a shareholder asked whether the company would provide a two degree of warming scenario analysis in accordance with recommendations handed down by the G20’s Taskforce for Climate Related Financial Disclosures (TCFD), Senex wasn’t able to answer the question because the company appeared not to know what the TCFD was!
Senex Energy’s commitment to a low-carbon economy further comes into question when one analyses the bonuses paid to the CEO and Senior Executive. Executives get paid for finding new fossil fuel reserves, even though these reserves cannot be burnt if we are to limit warming to below two degrees. A shareholder brought this into focus when they asked:
“With executive bonuses based on the replacement of 1P and 2P reserves, is our company putting shareholder’s wealth at risk by exposing them to reserves which may never be exploited?”
The board replied by saying they are confident that their gas will be used well into the future. This is after a rather disastrous five years that saw their net profit after tax fall from approximately $61 million profit in 2013 to a $22.7 million loss in 2017.
Conflict of interest
Tim Crommelin, a non-executive director of Senex, is also a member of the Senate at the University of Queensland. The campaigning group Fossil Free UQ have continuously called on the university to divest from fossil fuels. In October 2016 a vote was put to the university’s Senate on whether to divest its managed portfolio away from fossil fuels to which the Senate voted no. Investigation by 350.org and Fossil Free UQ has shown that seven members currently have ties to the fossil fuel industry (4 direct, 3 indirect), with one of them being Tim Crommelin. A shareholder today pointed this out and asked “How does Mr Crommelin justify his vote in the senate when there seems to be a clear conflict of interest between the two positions?” Mr Crommelin denied there was a conflict of interest.
Is your superfund invested in companies like Senex, which is paying their CEO bonuses based on finding new fossil fuel reserves? Find out here, and tell your superfund to divest from fossil fuels.
This article was co-written by Anthony Beshara and Rachel Deans