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Shareholders table resolutions with Australia's banks to stop fossil fuel financing

Shareholders table resolutions with Australia's banks to stop fossil fuel financing

Composite picture of a branch of the Australia and New Zealand Banking Group (ANZ) and Australia's Westpac Banking Corporation, in central Sydney, Australia, taken on Oct 25, 2017 and Nov 5, 2018, respectively. (File photo: (ANZ) Reuters/Steven Saphore; (Wespac) Reuters/David Gray)

SYDNEY: A group of shareholders filed climate change resolutions with three of Australia's Big Four banks on Thursday (Oct 7), asking them to abide by their self-declared support for net-zero emissions by 2050 and stop financing fossil fuels.

The resolutions ask for a firm commitment from Westpac Banking Corporation, Australia and New Zealand Banking Group and National Australia Bank not to fund any fossil fuel projects, in line with calls by the International Energy Agency (IEA).

The resolutions, filed by a group of about 100 shareholders, come ahead of the United Nations' COP26 climate talks in Glasgow, set to begin on Oct 31, and as Australia regulators step up their scrutiny of climate-related risks and disclosures.

They are unlikely, however, to be officially tabled for a vote at the banks' annual general meetings in December, partly because of restrictions under Australian corporate law.

But backing for these types of resolutions is often acknowledged at meetings and support for similar proposals has risen in recent times.

Last year, shareholder support for similar resolutions tabled at the annual meetings of ANZ and NAB doubled to 28 per cent and 26 per cent respectively.

In one of the three matching resolutions, the shareholders say: "Despite committing to the climate goals of the Paris Agreement ... ANZ is aligning its investment practices and policies with the failure of these goals, resulting in our company falling behind rapidly evolving investor and regulator expectations, and the practices of other financial institutions."

Earlier this year, a group of investors managing US$4.2 trillion, called on some of the world's biggest banks to toughen their climate and biodiversity policies or risk rebellions at their next annual meetings.

In a statement, ANZ said its thermal coal mining exposure had reduced significantly, while lending to renewables had increased. Exposures to oil and gas exploration and development has remained relatively flat.

The bank will update its Climate Change statement with new climate targets in the coming month, a spokesman said.

Westpac said it only finances emissions-intensive sectors in line with principles aligned with its climate change action plan, adding that the bank would not "establish relationships with new thermal coal mining customers".

At end-March, mining accounted for about 0.75 per cent of the bank's total loans and lending to oil and gas extraction represented 0.22 per cent, the bank said.

A May report by the International Energy Agency said there should be no more new fossil fuel projects after this year for the world to reach its target of net-zero emissions by 2050.

Australia, the world's biggest coal exporter and one of the world's largest carbon emitters per capita, has not signed up for that target, and this week approved its third coal mine extension in the past month.

Source: Reuters/ng


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