“Missed opportunity”: Glencore ignores major investors’ calls for transparency on thermal coal as crucial climate-vote looms

Major institutional investors behind a thermal coal shareholder resolution filed with Glencore plc have expressed disappointment at the decision by Glencore’s board to decline the request for greater transparency.

The resolution seeks disclosures on how the company’s thermal coal production aligns with the Paris objective of keeping global temperature increase to 1.5°C. It was filed late last year by a global coalition of institutional investors collectively representing $US2.2 trillion of assets under management, including: Legal and General Investment Management (LGIM), one of Europe’s largest asset managers; Swiss based Ethos Foundation, on behalf of large Swiss pension fund members of the foundation, including Pensionskasse Post and Bernische Pensionskasse (BPK); Vision Super, an Australian industry super fund; and HSBC Asset Management.

In April 2023, an additional group of institutional investors representing well over half a trillion dollars (approx US$596 billion) in assets under management added their support to the terms of the resolution.

In its Notice of Meeting (NoM), Glencore’s board said it will not support the resolution - due to be voted on at the AGM on 26 May in Switzerland.

“We are disappointed with Glencore's response to our thermal coal resolution and believe there is a fundamental lack of willingness to engage with four long-term institutional investors.

“It is deeply frustrating for investors that the only meaningful feedback on such a material issue is being conducted via the notice of a meeting, rather than in engagement discussions.  The principles which have long been core to investment stewardship and responsible shareholder engagement are being called into question.” Michael Marks, Head of Investment Stewardship and Responsible Investment Integration at Legal & General Investment Management (LGIM)

“The resolution aims to clarify how Glencore’s coal production and capital expenditure align with the 1.5°C goal, thus providing shareholders and stakeholders with crucial information for assessing Glencore’s role in the energy transition. It is important therefore that all shareholders of the company support this resolution.” Vincent Kaufmann, CEO Ethos Foundation

“We are very disappointed that Glencore did not support this resolution which would have once and for all set in place a mechanism for Glencore to demonstrate to investors that they were meeting their Paris commitments. " Michael Wyrsch, Chief Investment Officer & Deputy CEO, Vision Super

“This disregard for investors as they seek transparency across the Glencore business is a missed opportunity by the company to demonstrate respect for investors who are seeking clear information to navigate energy transition risks.

“At a time when Glencore is actively talking up a demerger of the coal business, investors expect the company to be upfront about the level of exposure to the risks of thermal coal. By failing to support the resolution, Glencore is denying investors the opportunity to fully assess this risk.” Naomi Hogan, Strategic Projects Lead, ACCR

Background

Glencore’s Notice of Meeting is available here.