Action against Glencore highlights the importance of a credible net-zero plan
What’s happening? Glencore is being accused by climate and community campaigners of greenwashing. The groups have lodged legal complaints against the commodity trading and mining firm for making misleading public claims on decarbonization while it is expanding its coal mine operations in Australia. Australia’s Environmental Defenders Office has launched complaints on behalf of Indigenous groups and climate advocacy groups, indicating the company’s claims around its environmental impact are deceptive and that its behaviour towards traditional landowners – Aboriginal peoples who hold land-specific rights and responsibilities – violates the Corporations Act 2001. (Eco-Business)
Why does this matter? The complaint accuses Glencore of misleading the public and its shareholders over its climate strategy. Similar action against the net-zero claims of firms such as ExxonMobil and TotalEnergies has already been taken. It’s likely this will become more common, signalling that firms with net-zero commitments will no longer be able to make sustainability-related claims without adequate decarbonisation plans and evidence to support them.
The Environmental Defenders Office (EDO) acts on behalf of Australian Indigenous group The Plains Clan of the Wonnarua People, community action group Lock the Gate Alliance and climate group Comms Declare. The EDO filed four additional complaints against Glencore to Australia’s Advertising Standards board, claiming its Facebook page, YouTube channel, website and news advertisements breach the Australian Association of National Advertisers Code of Ethics and the Environmental Claims Code. Environmental lawyer group ClientEarth has also joined the complaint.
What are the complainants arguing? Glencore’s “Advancing Everyday Life” brand campaign suggests the firm is environmentally focused, despite it being the world’s biggest coal exporter and Australia’s biggest producer of coal. The company spent over $84,000 solely on Facebook advertising in Australia since June, with imagery focused on forests, wind turbines and electric vehicles rather than coal. Glencore was also accused of discrediting Indigenous elders, who attempted to prevent the firm from proceeding with a coal mine project in New South Wales on a site of Aboriginal cultural heritage.
What is Glencore’s climate strategy? The firm has committed to net-zero emissions by 2050. Under this, it has a short-term target of curbing emissions by 15% by 2026 and a medium-term goal of halving its total Scope 1, 2 and 3 emissions by 2035 from 2019 levels. It will also invest in the production of key energy transition metals.
However, Client Earth has said that Glencore’s chosen decarbonisation plan is insufficient and is not specific to a company operating in the coal sector. Its coal operations make up 90% of its emissions, and the company continues to actively expand coal mining operations.
What are the implications of this? Glencore will likely face penalties and an injunction to prevent it from making similar claims in the future. More broadly, this provides another example of how stakeholders are making sure corporates’ stated climate actions are in keeping with their long-term climate targets.
Others are stepping in and taking action to assess the credibility of climate commitments. For instance, the recent launch of the High-Level Expert Group on the Net-Zero Emissions Commitments of Non-State Entities in June will take a closer look into whether a firm’s actions are aligned with its climate strategy. Considerations include the inclusion of sector-specific and interim targets, and whether a company’s lobbying is aligned with its climate goals and disclosure.