Whitehaven to improve climate reporting but sees strong coal demand
Whitehaven Coal has reiterated plans to improve its disclosure of climate change-related financial risks in 2019 but continues to see clean coal as a major future energy source.
Shareholder activist group Market Forces has pushed the coal miner’s shareholders to support three resolutions at its annual meeting on Thursday around greater climate change disclosure.
"Whitehaven did not appear to have its strategy aligned with a scenario consistent with holding global warming below 2 degrees Celsius. This amounts to second-guessing the ambition of 197 nations that signed the Paris Agreement,” Market Forces said ahead of the miner's annual general meeting on Thursday.
The first of the three resolutions is an amendment to the company’s constitution to allow for shareholders advising the board. The second relates to greater climate change risk disclosure.
The third resolution pushes for a re-alignment of Whitehaven’s strategy to be consistent with the goals of the Paris Agreement. This change in strategy would, in essence, require an exit from coal and no further development of its coal mines.
It follows moves by the Australasian Centre for Corporate Responsibility, which put forward similar resolutions for greater disclosure of climate change policies at Westpac, National Australia Bank, Origin, BHP and Rio Tinto, as well as detail about these companies' support for industry associations that don’t align with these policies.
Speaking ahead of the vote on the resolutions, Whitehaven chairman and former Nationals leader Mark Vaile reiterated comments made earlier this month that the company wanted to ensure its climate change disclosure practices broadly evolved "in line with industry trends and shareholder expectations".
"This is why we announced, that for 2019, we would look to align our reporting with the voluntary disclosure framework proposed by the task force on climate-related financial disclosure," he said.
"We have already had constructive interactions with a number of our larger shareholders and proxy advisors on this topic throughout the course of the year and of course we will have more to say in 2019."
However, Mr Vaile also outlined the continued demand for high-quality, low impurity coal for use in power generation.
He said there was the potential for thermal coal generation to grow more than 100 per cent in South-East Asia.
"The International Energy Agency new policies scenario validates our view that, in a more carbon-constrained future, there is a 'flight to quality', and high energy, low ash and low sulphur coal - of the type we produce - will be favoured by export markets in our region," Mr Vaile said.
"We continue to maintain our strong view about the resilience of thermal coal demand in the markets to which we are leveraged."
Market Forces research released last month suggests that of 74 ASX100 companies in sectors dubbed “high risk” for climate change impacts, only 55 per cent identified climate change as a material business risk, and more than 80 per cent did not have a plan to reduce their own emissions.
Whitehaven was among the lowest-scoring companies in the research, which found that the coal miner - a vocal proponent of "High Energy Low Emission" (HELE) coal fired-power stations - had not disclosed any risks it may face from climate change or listed it as a material business risk.
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