The Climate Advocacy Fund has lodged a complaint with Australia’s corporate regulator and is preparing legal action, after the boards of Paladin Energy and Aquila Resources refused to put Australia’s first climate change resolutions to shareholders.
In what could prove to be a litmus test for the Australian Securities and Investments Commission, the Climate Advocacy Fund - a joint initiative of the Climate Institute and Australian Ethical Investment - believes the regulator is within its power to require companies to disclose the climate risks associated with their operations.
Climate Institute business director Julian Poulter said ASIC should adopt a role similar to the US Securities and Exchange Commission that acts as a referee in disputes between boards and shareholders.
“At a time when leading companies are designing competitive strategies to thrive in a low-carbon world, this is strange behaviour from the boards of Paladin and Aquila when the purpose of the resolutions is to help protect shareholder long-term returns,” he said.
The climate fund announced in September plans to target Paladin and Aquila, along with Woodside Petroleum and Oil Search, for failing to provide adequate information to shareholders about their carbon footprints.
But shareholders at Paladin’s annual meeting today will not be given the opportunity to vote on the resolution regarding carbon disclosure after Paladin directors said it impinged on their authority to manage the company. Aquila also said the matter was one for management and not shareholders.
Oil Search has accepted the resolution, which will be put to its shareholders in May, while Woodside is taking legal advice on the resolution before its annual meeting in April.
ASIC declined to comment.
