Unprecedented Investor Call For Climate Risk Transparency From Mining Giants

Investors responsible for more than $8 trillion have called on mining giants Anglo American, Glencore and Rio Tinto to be more transparent over climate change risks and opportunities to their businesses. The move comes in the form of shareholder resolutions which have received unprecedented support, including from four of the world’s ten largest pension funds: Dutch funds ABP via APG and PFZW via PGGM, North American funds CalPERS and the Canada Pension Plan Investment Board.

For the first time in the UK, investors backing an AGM resolution make up 5% of a company’s voting shares – in this case Anglo American’s.

In another first, more than 100 co-filers who have Rio Tinto as part of their main investment portfolio have backed that resolution.

The ‘Aiming for A’ investor coalition filed two successful strategic resilience resolutions focusing on climate change with BP and Shell last year.

This year, as well as four of the world’s ten largest pension funds, four of continental Europe’s ten largest Fund Managers have also backed the resolution, including Aegon Asset Management, Amundi Asset Management, AXA Investment Managers and BNP Paribas Investment Partners.  There are eight co-filers across the UK’s ten largest pension funds and ten largest asset managers, including BT Pension Scheme, Railpen, USS, Aviva Investors and Schroders.

Schroders co-filed across the largest number of Anglo American shares, and Jessica Ground, Global Head of Stewardship, said: “We have been engaging with companies for some time on these issues and having a constructive dialogue. By co-filing and working with ‘Aiming for A’ we are supporting a more transparent and public discussion of these risks.”

The Paris Agreement has provided a major incentive for carbon intensive companies to assess and report on the risks and opportunities facing their organisations as a result of climate change.

The investors were supported by ClientEarth lawyer Alice Garton, who said: “These historic resolutions show how much investors value transparency on the climate risks and opportunities facing companies. The Paris Agreement was a game-changer for carbon intensive industries and company reporting. These resolutions, which we expect will become binding on management after the AGM votes, are an excellent example of investors’ desire for more complete information post-Paris.”

Funds belonging to the Local Authority Pension Fund Forum (LAPFF), which has been part of the coalition since its inception, made up half of the largest co-filers by shares held at Anglo American, with 18 funds co-filing across the three companies.

Cllr Kieran Quinn, LAPFF Chair, said: “Since co-filing the first strategic resilience resolutions in 2015, there has been a step-change in investor confidence. We are now seeing the larger pension funds and fund managers stepping forward to co-file. Part of this is testament to the positive engagement undertaken by the coalition and in-kind response from the company chairmen and boards.”

The ‘Aiming for A’ coalition believes that carefully crafted supportive but stretching shareholder resolutions can play a positive stewardship role during the multi-decade low carbon transition.