Green groups dob in Glencore for ‘greenwashing’

A Glencore spokesman said the company had not seen the EDO letter or referral and was not in a position to comment on the content.

“Glencore’s climate change strategy has been publicly communicated and covers our global portfolio of operations,” the spokesman said.

An ACCC spokesperson said: “The ACCC is in the early stages of considering the issues raised by the EDO. We do not comment on potential investigations.”

An ASIC spokeswoman said any reports of misconduct were received in confidence and did not say whether they were investigating the matter, but she did confirm ASIC is investigating a number of listed entities, super funds and managed funds, at different stages of investigation.

Unlike many of its rivals, which have cut their coal-mining activities amid criticism of the carbon emissions generated by the fuel, Glencore remains one of the biggest producers and is making record profits as coal prices rocket amid the Ukraine war.

Plans conflict with IEA’s finding

The complaint focuses on comments made on its website and in climate reports by the company to justify Glencore’s decarbonisation plans from December 2020 to July 2022.

Among those statements that Ms Ruddock singles out include Glencore’s claims that current plans are aligned with the goals of the Paris Agreement to keep temperature increases below 1.5 degrees Celsius; it’s committed to a 15 per cent reduction in emissions by 2026, and a 50 per cent reduction in emissions by 2035; its 2035 target is aligned with the International Energy Association’s net zero emissions 2050 roadmap scenario; and it will responsibly reduce or deplete its coal portfolio over time.

Ms Ruddock says Glencore has reproduced its global plan to hit net zero emissions, which talks about “global coal assets reach[ing] the end of the mine lives” without tailoring its message to the Australian market. She cites coal production generally expanding rather than significantly reducing in Australia, with some proposed mines such as Valeria in Queensland planning to operate until 2067.

“A more tailored message would be clear about Glencore’s expansion plans in Australia and the associated projected greenhouse gas emissions and would therefore demonstrate that Glencore has no plans to decarbonise in Australia and is in fact expanding its operations in the jurisdiction,” she said.

The lawyer also claims Glencore’s expansion plans conflict – rather than align – with the 1.5 degree pathway outlined by the Intergovernmental Panel on Climate Change and the IEA’s finding in its net zero emissions report last year that no new coal mines should be developed.

It is also claimed Glencore’s emissions do not appear to include all methane produced by their mines, and if these were included would require greater cuts to their emissions, and it has not shown respect for Aboriginal culture, custom, interests and rights.

“Taken together, Glencore’s acknowledgement of the investor expectation that Glencore aligns its business strategy with the goals of the Paris Agreement, combined with Glencore’s pledges, have a tendency to lead persons who consider those statements into error,” Ms Ruddock said.

“The conduct is apt to mislead users of this information as to how much Glencore does care and or/is acting on climate change.”

ASIC has been cracking down on “greenwashing” – the misrepresentation of products or investment strategies as environmentally friendly, sustainable or ethical – and has advised boards of companies about this.

In an information sheet on its approach to enforcement, ASIC said that if it pursues action on suspected misconduct, it could decide – depending on the seriousness of the infraction – to bring legal proceedings or take administrative or other enforcement action, for example, the suspension of a director.

The EDO lodged the complaint in Australia because Australian entities hold significant shares in Glencore, the parent company, which is listed on the London and Johannesburg Stock Exchanges. The lawyers have also lodged this legal letter with FCA in the UK.

Fossil fuel producers, ministers and statutory bodies are facing increasing legal and regulatory challenges amid intensifying tensions over expansion plans for oil, gas and coal that could jeopardise Australia’s emissions reduction commitments and its net zero obligations under the Paris climate accord.

The move follows Market Forces’ complaint to ASIC about potentially misleading “greenwashing” statements by Santos chairman Keith Spence and managing director Kevin Gallagher at its AGM in May, in a further escalation of climate pressures around the oil and gas producer’s expansion plans.