Where more investors, shareholders and consumers have begun to push back against major corporations for their failure to tackle climate change, 22 Australian companies have been bucking the trend.
Nearly two dozen Australian companies have been called out by environmental finance group Market Forces for pursuing new fossil fuel projects or banking their business strategies on the failure of the Paris Climate Agreement.
The public disclosure statements of all ASX300 companies were assessed by Market Forces to determine the extent of the business strategies’ alignment with the Paris Agreement climate goals – and found some were “actively undermining” the goals.
“22 ASX300 companies are acting in a manner that actively requires the failure of the Paris Climate Agreement, such as continued investment in fossil fuel expansion,” Market Forces stated.
Collectively, these firms make up 7 per cent, or $121 billion, of the ASX300.
21 of the 22 firms operate in the mining, resources, coal, oil, gas or energy sector, with the only exception being WH Soul Pattinson, an investment firm.
Last month, Market Forces revealed the 25 ASX100 companies that had failed to adequately disclose their climate risks.
Investors must act
Market Forces called upon investors and super funds to divest their holdings in the 22 firms.
“Super funds must ditch these companies if they are serious about playing their part in the fight against runaway climate change,” the environmental finance group said.
These firms were “uninvestable”, “out of line” and “out of time,” added Market Forces legal analyst Will van de Pol.
“Fully three years after the Paris Climate Agreement, these 22 companies continue to thumb their noses at investors on climate.”
What is the ‘Paris Agreement’?
The Paris Agreement is a landmark global climate agreement, of which Australia is a signatory, struck between 195 countries that sets out a global action plan to limit global warming to below 2 degrees celsius.
The deal was struck at the 21st Conference of the Parties (COP21) in Paris on December 2015, with the action plain is set to roll out in 2020.
Its goals include the effort to keep global warming below 1.5 degrees; to review targets every five years; and for a robust transparency and accountability framework.
According to the Australian Department of the Environment and Energy, Australia’s target is to reduce emissions by 26-28 per cent below 2005 levels by 2030.
“Australia’s targets will be achieved through a credible policy suite that is already reducing emissions, encouraging technological innovation and expanding our clean energy sector,” the Department said.
The Australian government’s approach to climate change has been flagged as a key federal election issue, and indeed has been cited as partially responsible for the felling of Malcolm Turnbull from his role as prime minister.
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