BlackRock and MFS Investment Management voted both against Glencore’s climate plan during the Swiss miner’s annual general assembly earlier this year. This marked a rare split between the mining firm and two of its biggest institutional shareholders on environmental policy.
Investors have been asking more questions about Glencore’s plans to reduce emissions and continue producing coal.
New disclosures in US securities filings reveal that many large institutional shareholders supported Glencore’s climate report. The report was approved with 70% approval, even though the dissent rose to 30%, from 24% in 2022.
According to S&P Capital, BlackRock, with an 8.2 percent stake valued at more than £4bn is Glencore’s third largest shareholder. MFS, on the other hand, is its ninth largest shareholder with a 1.1% stake.
According to , its summary of investment stewardship for 2023, BlackRock cited concerns over “inconsistencies in the company’s stated strategy” as the reason it voted against the climate plan.
In the weeks before Glencore’s AGM, in May, it made a bid to take over Teck Resources of Canada. This company is a coal miner that produces steel and base metals.
Although Glencore’s bid to buy Teck has been rejected, both companies are still in discussions about whether Glencore could purchase Teck coal operations.
Glencore intends to spin off the coal business if its acquisition of Teck’s coal unit proves successful.
Glencore aims to achieve net zero emissions in 2050 and plans to reduce emissions (direct and indirect) 15 percent by 2026 compared to the baseline year of 2019.
The total emissions of the company in 2022 were approximately 370mn tonnes equivalent carbon dioxide, with most of these indirect emissions coming from customers who burn coal.
Gary Nagle, the chief executive of the company, said in June that the vote on climate change showed “overwhelming shareholder support”. He attributed an increase in dissenting voting to “some ESG employee in the basement of office number 27”.
A resolution by shareholders calling for greater clarity about Glencore’s coal plan was also met with high levels of opposition, with only 29% of shareholders voting in favor and 71% against.
Investors including Legal and General and State Street, as well as HSBC Asset management, supported this resolution. However, recent proxy filings reveal that Glencore’s largest institutional shareholders, including BlackRock, did not support the measure.
Glencore, following the AGM results in May, is consulting with its major shareholders about both the climate plan and shareholder resolution.
Glencore’s largest shareholders include both current and former company directors. These private holdings, however, are not included in the public shareholder registers unless they represent more than 3% of company shares. Ivan Glasenberg, Glencore’s former chief executive, is the largest shareholder at 9.8%.