Bluebell Capital Partners – To vote “AGAINST” the proposal by Glencore Plc’s Board of Directors, to approve the 2021 Climate Progress Report and to re-elect Peter Coates as a director at the AGM called on April 28th, 2022

LONDON, March 31, 2022 (GLOBE NEWSWIRE) -- Bluebell Capital Partners announces that it will vote AGAINST (i) the consultative proposal by Glencore Plc’s (“Glencore” or the “Company”) Board of Directors, to approve the 2021 Climate Progress Report (Resolution 13) and (ii) to re-elect to the board, director Peter Coates (Resolution 4), current Chair of the Health, Safety, Environmental and Communities (HSEC) Committee, at the AGM on April 28^th, 2022.

In December 2020, Glencore announced, as one of its “priorities”, to “reduce coal production in line with the electrification and decarbonisation of global energy systems”¹, with a 20-30 Mt reduction target for its coal production, relative to the company’s prior guidance in December 2019. The plan was approved by a consulting vote of Glencore’s shareholders, at the 2021 AGM, with a 94.4% approval.

Despite the AGM’s consultation vote giving a clear indication of shareholders’ desire to pursue a reduction of the company’s carbon footprint, Glencore embarked on several initiatives² to increase coal production capacity and, on December 2^nd, 2021 announced a significant uplift in coal production, thus acting in the exact opposite direction to what shareholders approved at the 2021 AGM. Our concerns can be summarised as:

1. whilst aligned with a net-zero goal by 2050, Glencore’s short-term commitment to CO₂ emission reduction (15% by 2026) is underwhelming, considering that they have already achieved a 25% reduction in emissions at the end of 2021, de facto building headroom to grow emissions in the next 5 years.
2. on the other hand, intermediate (50% by 2035) and long-term (100% by 2050) total emission reduction targets are so backloaded and vague that the existing Board of Directors could not be held accountable for any failure to meet those long-dated targets, which would almost definitely exceed their tenure.
3. existing CO₂ targets lack any real intermediate milestone for the existing Board of Directors to be properly assessed. The overall amount of CO₂ emitted can vary significantly depending on what “Path to Net Zero” is taken. 
4. the stated targets are in relative terms vs. 2019, which was the production peak of the past 7 years. 
5. the 2021 Climate Progress Report makes no reference to the coal production volume cap, initially set in 2018 (150 Mt p.a.), when instead it should remodel the cap to reflect CO₂ emission target net of any off-set.
   

Director Peter Coates joined the board in April 2011 and is its longest-serving member. Mr. Coates does not qualify as independent and nevertheless accepted to chair the Health, Safety, Environmental and Communities (HSEC) Committee, from which we deem that he has failed to address any of the environmental issues previously highlighted.

Glencore stated that “if the vote either against the Climate Change Plan or the Progress Report is more than 20% of the votes cast, then the Company will engage with major shareholders to understand the areas of concern and consider appropriate changes to the Climate Plan or its implementation as appropriate”³, therefore we urge fellow Glencore’s shareholders to vote AGAINST the consultative proposal, by the Board of Directors, to approve the 2021 Climate Progress Report.

We believe that Glencore should spin-off the coal business whilst retaining sufficient governance to exercise oversight on the responsible run-off of the business. For more details on our coal separation proposal, please refer to the presentation available on the web link Bluebell Capital Partners on Glencore 2022 AGM⁴

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¹ Source: Glencore, “Our Purpose”, Investor Update 2020, 4^th of December 2020
² 28 June 2021: acquisition of control stake in Cerrejon coal mine: +15/20 Mt capacity per year; 23 December 2021: progressed application for a greenfield coal mine in Australia (project Valeria) for potential additional capacity of “up to 20Mt” per year; 24 February 2022: advanced to the next stage of permissions for the expansion of Glendell mining area: +10 Mt
³ Source: Glencore, Notice of Call, 2021 AGM, Letter from Chairman
⁴ https://www.dropbox.com/scl/fo/t6rkhxw9drvxxt7pbardm/h?dl=0&rlkey=vut47880fcud3w1201eg26jwb