The board of diversified miner Glencore believes the environmental, social and governance (ESG) responsibilities associated with its coal assets are best managed by the company as a responsible operator, rather than letting those responsibilities become the problem from someone else, said the chairman of Glencore Kalidas Madhavpedi said April 21 at the launch of the company’s 2021 sustainability report.
“It’s not just that simply transferring carbon-intensive assets to others won’t get the world back to net zero – it’s likely to be less efficient to do so while increasing other ESG risks and by reducing transparency,” he said.
Madhavpeddi said the diverse miners board believes its model for responsible management of the company’s coal assets is the right one for all stakeholders.
“Climate change is a standing item on the board’s agenda. In 2021, we revised our internal climate change governance framework to drive the implementation of our climate strategy and accompanying work programs.
“Strategic decisions about our climate program are made by the board and our new climate change task force has its goals set by the board, which oversees its work,” he explained.
He said Glencore would continue to review the alignment of positions and activities of mining industry organizations relating to climate change and energy with its own position on climate change and the goals of the Paris Agreement. .
“If an industry organization adopts an approach inconsistent with our values, code of conduct or policy of political engagement, or the goals of the Paris Agreement, we will take appropriate action. This may include constructive engagement with the organization or, if no progress can be made, resigning from that organization and establishing independent advocacy,” Madhavpeddi noted.
CEO Gary Nagle added that in 2021, the rollout of new and revised group-wide policies and accompanying governance documents initiated a more robust and consistent approach to health, safety, environment, community and human rights in all business operations.
“We also recognize our stakeholders’ focus on climate change and their expectation that Glencore aligns its business strategy with the goals of the Paris Agreement. We are undertaking extensive dialogue with interested stakeholders, in particular with the Climate Action 100+ investor group,” he added.
In 2021, Glencore revised its commitments to reduce its total emissions footprint towards its goal of net zero emissions by 2050. The revised targets were a 15% reduction by 2026 from 2019 levels; and a 50% reduction by 2035 from 2019 levels.
“We use the Intergovernmental Panel on Climate Change (IPCC) scenarios to illustrate our compliance with the net zero ambition. Our 2026 target is within the range of the IPCC’s 1.5°C scenarios – IPCC SR1.5 – and our 2035 target is aligned with the International Energy Agency’s Net Zero Emissions Scenario by 2050, which which complies with IPCC SSP1-1.9,” Nagle explained.
IPCC SSP1-1.9 is the IPCC’s most optimistic scenario, where global emissions are reduced to net zero by around 2050.
The 2021 Sustainability Report incorporates Glencore’s ESG data collection, which aligns with the reporting requirements of the Global Reporting Index and corresponds to the principles of the International Council on Mining and Metals, the principles of the United Nations Global Compact and the reporting requirements of the Sustainability Accounting Standards Board’s Metals and Mining Sustainability Accounting Standard.
The report focuses on areas identified as important to Glencore, its assets and its internal and external stakeholders. As well as providing an overview of the approach, performance and activities during the year for each material topic, the report includes case studies of the work undertaken by the company’s commodity departments to improve the performance of its operations.