Santos to allow shareholder vote on climate at 2022 AGM

SANTOS has announced it will allow shareholders to have a non-binding advisory vote on the company’s Climate Change Report at its 2022 annual general meeting.
Santos to allow shareholder vote on climate at 2022 AGM Santos to allow shareholder vote on climate at 2022 AGM Santos to allow shareholder vote on climate at 2022 AGM Santos to allow shareholder vote on climate at 2022 AGM Santos to allow shareholder vote on climate at 2022 AGM

Santos CEO and MD Kevin Gallagher

Mark Tilly

Journalist

Mark Tilly

 

 

The move comes as the resources industry is faced with growing pressure to allow shareholders to vote on companies' climate and emissions reduction policies. Miner Rio Tinto announced it would give shareholders similar powers at its AGM next year. 

The vote, known as the Say on Climate initiative, provides shareholders a non-binding vote on Santos' Climate Change Report. 

Australian Centre for Corporate Responsibility, which has been pushing Santos to pledge more ambitious emissions reduction targets, welcomed the news saying it would engage with the company to extend the annual vote beyond 2022. 

"We welcome Santos' commitment to transparency and its acknowledgement of shareholders' appetite to provide formal input into transition planning," ACCR director Dan Gocher said. 

Santos managing director and CEO Kevin Gallagher defended the company's policy, describing it as ‘ambitious and credible', as it looks to reach net-zero emissions across scope 1 and 2 by 2040. 

The company noted management remuneration is also linked to the company's emission reduction targets and shareholders are already able to vote on adoption of the remuneration report at the AGM. 

Santos is also investing in CCS through its Moomba project which will capture an initial nameplate capacity of 1.7 million tonnes of carbon per year and store it in underground reservoirs in the Cooper Basin. 

"CCS is a critical technology to achieve emissions reduction and unlock the production of zero-emissions hydrogen," he said in a statement on Tuesday. 

However Gocher noted the initial 1.7MMtpa is just 4.4% of Santos' total carbon footprint, adding that Santos had no plans to address scope 3 emissions - the largest part of its carbon footprint. 

The commercial viability of CCS technology was questioned by FMG chairman Andrew Forrest yesterday as he announced his company would use renewable electricity, green hydrogen and ammonia to decarbonise its operations. 

However CCS projects have the support of the federal government through its Technology Investment Roadmap and its former chief scientist Dr Alan Finkel. 

Meanwhile, ACCR said the pressure was now on Woodside Petroleum, Oil Search and others to adopt the Say on Climate voluntarily.

"Due to the rapid transition taking place in the energy sector, it is imperative that shareholders are provided with the information required to assess the future earnings and value of these companies," Gocher said.