Leading investors welcome Anglo American’s commitment to align lobbying activity with Paris Agreement
Leading investors today welcome a commitment secured from Anglo American, the UK based global extractives company, to align its lobbying activity with the goals of the Paris Agreement.
The announcement is the outcome of extensive engagement with the company by members of the Institutional Investors Group on Climate Change (IIGCC), as part of its European Corporate Climate Lobbying Initiative. This is backed by leading investors with over $4.7 trillion in assets under management1.
The result of constructive discussions with the company over past months, Anglo American has committed to:
- Ensuring action is taken on any fundamental misalignments that emerge between Anglo American’s policy positions, including those that support the goals of the Paris Agreement, and those of an industry association of which the company is a member.
- Updating its Code of Conduct and Group Business Integrity Policy to reflect relevant changes in standards of behaviour and due diligence expected of industry associations.
- Setting out a clear process for action to be taken when misalignments between Anglo American policy positions and those of the industry associations are identified.
- Publishing the membership of all its industry associations, including fees paid and a short description of the rationale for each membership.
See the company’s website here for more detail on the above. The steps outlined are to be completed prior to its annual general meeting in May 2020.
Anglo American joins 11 other global companies, including Glencore, that have already committed to positive lobbying practices on climate change, as the result of engagement through IIGCC’s European Corporate Climate Lobbying Initiative2.
The commitments are also made in line with the European Investor Expectations On Corporate Lobbying On Climate Change. Investors will expect the company to act accordingly with each aspect of the expectations. This includes ensuring lobbying activity only supports, rather than frustrates, delivery of the Paris Agreement. They also set out how lobbying activity should be undertaken in a fully transparent and accountable manner, supported by robust governance and reporting procedures. This provides investors and other stakeholders with the means of assessing progress on implementation and holding companies to account where required.
Stephanie Pfeifer, CEO, Institutional Investors Group on Climate Change, explains: “Anglo American can be commended for joining the growing list of global companies committed to positive lobbying practices on climate change. In the face of the climate crisis, this must become standard practice for global companies across all sectors of the economy.
“It’s important investors see Anglo American follow through by meaningfully putting its commitment into practice. Trade bodies must be called to account where they are opposing, impeding or evading the policy required to support decarbonisation and reduce global emissions. The company will have the full support of investors in acting where needed and engagement will continue to ensure they do.”
Adam Matthews, Co-lead for the IIGCC European Corporate Climate Lobbying Initiative and Director for Ethics & Engagement for the Church of England Pensions Board, adds: “The recent UN climate negotiations in Madrid have shown that there is a long way to go to secure the policy and regulatory environment needed to achieve the goals of the Paris Agreement. Investors are concerned about the role of industry association lobbying regionally, nationally and internationally in shaping that regulatory environment, which is often at odds with the ambition needed to achieve the Paris Agreement.”
“Following engagement this is a significant statement by Anglo American that shows both good governance of this issue within the company and a commitment to act decisively when they find misalignment in their industry memberships. All companies need to adopt such procedures to retain the confidence of their shareholders on this important issue.”
Andy Jones, Engagement Professional – Hermes EOS, Hermes Investment Management, said: “We welcome Anglo American’s notable step forward in its governance of climate change and related risks from the activities of the trade associations of which it is a member. It is further acknowledgement by the company of its responsibility and influence on the issue beyond its corporate boundary.
“The commitment demonstrates that the company is prepared to ‘walk the talk’ in its support for the Paris Agreement and, ultimately, to align its activities behind its purpose of re-imagining mining to improve people’s lives. We are pleased to see the company’s constructive engagement with shareholders on this issue. We will monitor with interest whether peer companies follow this lead and will take action where they do not.”
Charlotta Dawidowski Sydstrand, Sustainability Strategist AP7, explains: “We welcome Anglo American to the growing group of companies who have committed to manage not only their direct climate impact but also the indirect impact on climate policy through trade associations lobbying.
“The need for urgent political action has never been more important than today when on current pledges, the world is heading for a three degrees temperature rise. We hope other companies will be inspired by Anglo American and also commit to review their climate lobbying.”
Anders Schelde, CIO of Danish pension fund, MP Pension, adds: “The global miner Anglo American has now joined the group of global companies expected to slam the door on trade associations which seek to undermine climate action. This demonstrates that shareholder action works and that those companies who fail to address inconsistencies in their support for the Paris Agreement will increasingly be challenged.”
Engagement with Anglo American was primarily led by the Church of England Pensions Board, Hermes Investment Management and the Central Finance Board of the Methodist Church, with the support of additional leading investors.
Anglo American and the other companies to have made commitments on climate aligned lobbying are on the Climate Action 100+ focus list. IIGCC is one of five global partner organisations behind Climate Action 100+ as an initiative and facilitates investor engagement across Europe.
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Notes to Editors
- See here for details of investors that have endorsed the European Investor Expectations on Corporate Lobbying on Climate Change. Aberdeen Standard and have also supported the initiative following publication.
- Commitments to align lobbying practices with the goals of the Paris Agreement secured through IIGCC European Corporate Climate Lobbying investor engagement are: ArcelorMittal, BASF, BHP Billiton, BP, Equinor, Glencore, HeidelbergCement, Repsol, Rio Tinto, RWE and Shell.
About IIGCC: The Institutional Investors Group on Climate Change (IIGCC) is the European membership body for investor collaboration on climate change and the voice of investors taking action for a prosperous, low-carbon future. IIGCC has more than 190 members, mainly pension funds and asset managers, across 14 countries, with over €28 trillion assets under management.
Our mission is to mobilise capital for the low carbon transition and to ensure resilience to the impacts of a changing climate by collaborating with business, policy makers and fellow investors. IIGCC works to support and help define the public policies, investment practices and corporate behaviours that address the long-term risks and opportunities associated with climate change. For more information, visit www.iigcc.org.
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