https://www.miningweekly.com
Africa|Coal|Environment|Gas|Power|Projects|Road
Africa|Coal|Environment|Gas|Power|Projects|Road
africa|coal|environment|gas|power|projects|road

Sasol scores ‘own goal’ as climate pressure mounts in South Africa

29th November 2019

By: Bloomberg

  

Font size: - +

Sasol, South Africa’s second-biggest polluter, angered some of its investors by refusing to put a resolution on its response to climate change to shareholders and could face legal challenges if it continues to refuse votes on the issue.

Sasol dismissed a request by some investors, including Old Mutual Investment Group, to table the resolution that demanded more clarity on its greenhouse-gas emissions and reduction targets, at its annual general meeting on November 27. That contrasts with Standard Bank Group and FirstRand, which have become the first South African companies to allow climate-risk resolutions to be voted on by shareholders.

Sasol’s decision comes as pressure builds on South African companies to act on climate change in a country that depends on coal for most of its power. South Africa’s greenhouse-gas emissions match those of the UK, which has an economy eight times bigger.

Sasol dismissed the request citing legal advice that it said found it wasn’t obliged to put climate-risk matters to shareholders. It gave no details on the legal opinion. “Ongoing, robust” engagement is a more effective way of understanding shareholder concerns, Sasol said in response to questions on Friday.

‘OWN GOAL’
At the meeting the company did commit to producing a “road map” on its climate risk mitigation strategy in 2020. It produced its first climate change report earlier this year. Sasol said that was a “significant first step.”

“They scored an own goal,” said Asief Mahomed, chief investment officer of Aeon Investment Management, which backed the resolution along with Old Mutual and four other fund management companies. “We are exceptionally disappointed with the way they handled the process.”

Sasol, which emissions data show is the country’s second-biggest polluter after Eskom Holdings, spurned a similar move last year and investors say they will keep pushing the company for more clarity as environment, social and governance concerns became increasingly prominent in investment decisions.

The right of companies to block resolutions on climate matters “is not tested in court,” said Jon Duncan, head of responsible investment at Old Mutual Investment. “It will need to be contested at some point.”

JSE, which owns the stock exchange where Sasol has its primary listing in Johannesburg, declined to comment.

DIFFICULT POSITION
Old Mutual will continue to engage Sasol on the issue in coming months, Duncan said. Companies that backed the resolution were Aeon, Sanlam Investment Managers, Abax Investments, Coronation Fund Managers and Mergence Investment Managers.

“We certainly felt there was an opportunity for them to test the waters for their shareholders,” he said. “Sasol are in a very, very difficult position.”

The company produces chemicals and fuel, mostly from coal, and is already under pressure from investors after a chemical projects in the US doubled in cost to almost $13-billion, resulting in the resignation of its co-chief executive officers.

At the AGM, new CEO Fleetwood Grobler and chairperson Mandla Gantsho said the pace at which it could reduce greenhouse-gas emissions needed to be balanced with the need not to worsen inequality and unemployment in South Africa.

“It is important to ensure that our activities to reduce greenhouse gas emissions do not exacerbate our current national circumstances,” Sasol said.

While the company employs 31 000 people, it also produces 14% of South Africa’s greenhouse gas as well as other pollutants such as sulfur dioxide that affect communities near its plants.

Edited by Bloomberg

Comments

Projects

Latest News

Resources Watch
Resources Watch
27th March 2024

Showroom

WearCheck
WearCheck

Leading condition monitoring specialists, WearCheck, help boost machinery lifespan and reduce catastrophic component failure through the scientific...

VISIT SHOWROOM 
Yale Lifting Solutions
Yale Lifting Solutions

Yale Lifting Solutions is a leading supplier of lifting and material handling equipment in Southern Africa. Yale offers a wide range of quality...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Hyphen, Eva mine, ferrochrome price make headlines
Hyphen, Eva mine, ferrochrome price make headlines
27th March 2024
Resources Watch
Resources Watch
27th March 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.136 0.172s - 91pq - 2rq
Subscribe Now