A shareholder resolution filed by the ACCR, seeking Origin Energy Ltd conduct a review of lobbying memberships and report on whether lobbying groups (including industry associations) are obstructing action on climate change, has secured the 'largest vote for any shareholder proposal in Australian corporate history' receiving 46% proxy support ahead of the meeting despite the fact that it was not supported by the board.
One of the ACCR's four shareholder resolutions at Origin Energy Ltd (Origin) (seeking disclosure of membership of industry associations and review/disclosure of lobbying interests) received 46% proxy support ahead of the meeting. Though ultimately unsuccessful, Origin has nevertheless committed to providing greater disclosure of its membership of industry associations, including describing processes for engagement and the company's contribution to policy advocacy, in future annual sustainability reports. The remaining proposals (constitutional amendment; setting emissions targets aligned with the Paris Climate Agreement; and ensuring prior and informed consent of Aboriginal traditional land owners has been established in relation to potential exploration sites in the Northern Territory) were unsuccessful with opposition ranging from 86% to 90%.
Despite the low levels of support for ESG resolutions in the 2017 AGM season, The Australasian Centre for Corporate Responsibility (ACCR) lodged four shareholder resolutions at the Origin Energy Ltd AGM.
The resolutions were as follows:
- Constitutional Amendment: Special resolution to amend the company's constitution: a binding resolution to amend the constitution to allow for the submission of non-binding advisory shareholder resolutions. (Contingent on the constitutional amendment, three further advisory resolutions were also submitted).
- Informed consent of Traditional Owners: Ordinary resolution on 'Free, Prior and Informed Consent' from the Aboriginal Traditional Owners and communities (who may be affected by Origin's intended operations in relation to petroleum exploration permits in the NT). Commenting on this proposal, ACCR stated that it is the first proposal of its kind ever voted on in Australia.
- Alignment of strategy with Paris 2C target: Ordinary resolution on emissions targets (aligned with the goal of the Paris Climate Agreement to limit global warming to well below 2C).
- Review of lobbying activity/disclosure: Ordinary resolution seeking a 'comprehensive review' of the 'company's positions, oversight and processes related to direct and indirect public policy advocacy' (a review of the alignment between the company's stated position on climate and lobbying positions held by various industry associations/other bodies, and disclosure of the financial contributions made to the company by associations/other bodies).
[Note: The full text of the resolutions is here]
Origin has committed to providing increased disclosure on lobbying/membership of industry organisations
The Origin AGM was held on 17 October 2018 and resolution 4 above (review of lobbying activity/disclosure) received 46.3% of proxy votes lodged ahead of the meeting in support, which ACCR comments is the largest vote for any shareholder proposal in Australian corporate history.
Origin's Chair Gordon Cairns acknowledged that the issue 'is of considerable interest to our shareholder base' and that on this basis the company would be 'very happy to improve the disclosure of our membership of industry associations, including describing our processes for engagement and our contribution to policy advocacy in our future annual sustainability reports'.
Remaining ESG proposals unsuccessful: The remaining proposals were unsuccessful with opposition ranging from 86% to 90%.
Commenting on the issue of consultation with traditional land owners in the NT, Origin's Chair defended the company's consultation process stating that the company is comfortable that it has respected the rights of the traditional owners and the requirements of the Northern Land Council in its engagement to secure community support for drilling next year in the Beetaloo Basin.
Origin's remuneration report received 92.63% support from proxies lodged ahead of the meeting.
Most successful AGM season yet?
Citing the results at Westpac and Origin (discussed in a separate post in the 23/10/2018 issue of Governance News), the ACCR comments that 'This AGM season is shaping up to be our most successful yet'.