Climate change the hot issue at BHP AGM

A FRUSTRATED Jac Nasser defended BHP Billiton’s commitment to climate change at the mining giant’s Australian annual general meeting yesterday, as the issue dominated shareholder questions.

Kristie Batten

When the first four questions the chairman received were on climate change, it became clear the issue would be the hot topic at the Perth meeting.

Nasser said BHP had first started thinking about climate change two decades ago.

“So what you’re asking us to do, in essence, we started doing 20 years ago,” he told shareholders.

He went as far as saying BHP was a “dream” company to invest in against the backdrop of climate change.

“This company is well positioned for a company no one can define.”

Nasser said he was frustrated by the fact that the company had the “foresight” to think about climate change so long ago but was coming under such scrutiny.

Questions ranged from whether the company’s assets would become “stranded” due to the carbon bubble, whether the company had set aside a fund for “climate change impact compensation” and whether the company would invest in wind or solar – with the answer to all three being no.

At one point Nasser declared that the topic had been exhausted for the day.

But despite the heavy focus on the issue, climate change activist and former Australian Coal Association chairman Ian Dunlop failed to win a board seat, securing less than 4% of the vote.

Addressing the meeting, Dunlop said climate change was a question of urgency and required far more rapid action.

Nasser responded by saying: “Your sense of urgency meter might be more sensitive than ours.”

BHP defended its board and management, saying it already contained the necessary expertise on climate change.

“John Schubert is an expert in climate change,” Nasser said.

“Track us, don’t trust us, but I think you have a fair degree of trust based on our track record.”

After the meeting, Nasser was asked again about climate change by media.

“It did take up a considerable amount of time at the meeting, but it should – it’s a very fundamental issue,” he said.

“We’re happy with the discussion, we’re comfortable with dialogue and differences of opinion and I think you heard those at the annual general meeting today and I think it’s a reflection of what you have out there in society.

“It’s complex – there are many views.”

Nasser emphasised that BHP believed in climate change.

“We do accept the climate science, we’ve said that for at least a decade and we do accept that actions have to be taken and we were one of the first in 2010 – well before any government in Australia put forward their plans – to come out with our six principles on carbon reduction and carbon pricing,” he said.

“So this is not a strange subject to us and we welcome the dialogue.”

According to Nasser, now is a good time to figure out what works in terms of policy.

“We articulated six principles back in October of 2010 and they may not be perfect principles but we did articulate them then and what we’re really saying to the present government is ‘let’s sit back and test any further action against those principles’,” Nasser said.

“What you do not want is to be in a situation where you charge ahead in one direction and ruin the competitiveness of industry in Australia.

“What we’re saying is that there is a time – and now is a good time – to stop and re-evaluate what the best way forward is, because I don’t think that there is enough detail in any policy that is out there at the moment that we can comment on in any direct way.”

Nasser stressed that BHP wanted to be part of the debate and provide input.

“There is no one single solution – there just isn’t, but we do believe a price mechanism of some sort is a valid approach,” he said.

“I would just like to say the following: that if you are a believer in climate change and we are, we believe in the science, then if you are investing in a resource company, I would think that the most diversified resource company in the world is BHP Billiton and that’s where you would want to invest your money.

“We did not become a diversified commodity company and resource company by accident – we actually got here through many generations of strategic thinking and challenges such as climate change so we’re flattered by the interest in the subject – it’s a subject that has been central and core to our strategic thinking for about 20 years and we welcome an open dialogue on it.”