Institutional shareholders angry at Woodside Energy’s approach to climate change will take their fight to its board for the first time.
They are targeting three long-standing directors up for re-election – Queensland Resources Council chief executive and former federal resources minister Ian Macfarlane, Singaporean oil and gas executive Swee Chen Goh and former oil boss and American Larry Archibald.
The non-executive trio is up for another stint on the 10-member board (not including chairman Richard Goyder and managing director Meg O’Neill) and were expected to be rubber-stamped at an annual general meeting next month.
But shareholder advocacy group the Australasian Centre for Corporate Responsibility (ACCR), alongside institutional investors industry superannuation fund Vision Super and fund manager Betashares – said on Wednesday they had lost faith in the directors.
In statements relating to the re-election of directors sent to Woodside, they call for all three to be held to account for repeatedly failing to have a credible climate strategy and continuing to allocate the bulk of Woodside’s capital to developing new oil and gas projects.
The activist shareholders are also concerned carbon offsets continue to dominate Woodside’s strategy to cut emissions at production sites, according to the statement filed with Woodside ahead of the annual general meeting on April 23.
Shareholders across the Australian market are increasingly demanding climate accountability and sustainability competence at the board level, and many boards – including Woodside’s – have acknowledged climate change as an issue that will affect their business.
But ACCR spokesman Alex Hillman said the Woodside board is stuck in the past with no credible plan to create long-term value for shareholders by taking advantage of the energy transition away from fossil fuels.
Although Woodside is producing record returns amid high commodity prices, investors have concerns about what future value it will have in a net-zero economy.
Vision Super chief investment officer Michael Wyrsch said Woodside had a second chance to pursue a viable long-term strategy with the war in Ukraine up-ending energy markets, but again failed to grasp that opportunity.
Company board directors, who are accountable to shareholders, are usually swiftly re-elected by shareholders voting on resolutions at annual general meetings.
This is the first time investors at the institutional level have sought to bring climate accountability to a board by dissent.
“Director re-elections are not rubber-stamping exercises,” Mr Hillman said.
Woodside confirmed to AAP that members’ statements have been received from ACCR ahead of the AGM.
“These statements were not compliant with the requirements of the Corporations Act, and so will not be included in the upcoming notice of meeting,” a Woodside spokesperson said.
In response, ACCR said it was deeply concerned at the apparent denial of shareholders’ ability to voice concerns about governance at the AGM.
“This is a bold move from a company facing allegations that it does not listen to shareholders,” Mr Hillman said.
“ACCR will be disputing this vigorously with the company,” he said.
-AAP
