|BHP Group Plc/Limited||2020||N/A||https://www.blackrock.com/corporate/literature/press-release/blk-vote-bulletin-bhp-oct-2020.pdf|
…We have engaged with members of BHP’s board and management over a dozen times since 2018. We have discussed a range of material environmental, social and governance issues, including climate-related risks and opportunities, operational sustainability, human capital management and industry associations. BIS acknowledges BHP’s leadership position on many of these issues.
BHP received three shareholder proposals at this year’s annual general meetings (AGMs) submitted by the Australian Center for Corporate Responsibility (ACCR): Item 23 to Amend Constitution of BHP Group Limited; Item 24 to Adopt Interim Cultural Heritage Protection Measures which has subsequently been withdrawn; and Item 25 to Approve Suspension of Memberships of Industry Associations where COVID-19 Related Advocacy is Inconsistent with Paris Agreement Goals.
…The proposal asks the company to be rigorous in its assessment of the policy positions of the industry associations of which it is a member, encouraging it to develop and further enhance its “climate leadership” strategy. Given the global pandemic and resulting economic uncertainty, this is increasingly an important matter for companies’ resilience and long -term financial performance.
In BIS’ vote bulletin on the 2019 BHP AGM, we highlighted BHP as “an industry leader on climate-related issues.” That view remains unchanged. BHP’s climate standards go beyond the Paris Agreement Goals. The company is also investing in technologies to help customers reduce emissions, making it one of the few mining companies to actively address Scope 3 emissions.
The company has also demonstrated leadership among its peers regarding transparent management of industry associations. Since 2017, it has conducted regular and comprehensive reviews of industry associations on climate and energy policies in which it holds an active position. This process includes explicitly naming the industry associations of which it is a member and identifying any misalignment on key positions.
In 2017, BHP left the World Coal Association after identifying material differences with its own climate and energy policy positions.5 More recently, the company suspended its membership of the Queensland Resources Council. These actions demonstrate BHP’s willingness to act when it identifies material dissonance between its position and those of its industry associations. BIS believes these actions, and the company’s continued efforts to monitor its trade associations,7 show that BHP recognizes the business risk of policy position misalignment.
- Approve review of advocacy activities and suspension of memberships of industry associations where COVID-19 related advocacy is inconsistent with Paris Agreement Goals
BIS supported the shareholder proposal (Item 25) to signal the importance of the opportunity for BHP to continue to use its leadership position to constructively influence its trade associations to further advance the global energy transition. As support for this resolution is not a signal of dissatisfaction, BIS has not voted against any members of BHP’s Board of Directors, which would typically be our approach to flag significant concerns around a company’s management of material ESG issues.