Sasol Shareholders File South Africa’s First Climate Lobbying Resolution

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  • On 14 September 2021, Just Share and Aeon Investment Management co-filed a non-binding, advisory shareholder resolution at Sasol Limited, for tabling at its 19 November AGM. 
  • The resolution asks Sasol to improve and expand its disclosure of its direct and indirect climate lobbying, including disclosing the annual membership fees paid to industry associations which are involved in climate lobbying activities.

Climate lobbying shareholder resolutions have been filed annually at fossil fuel companies in other jurisdictions for a number of years, but this is the first time such a resolution has been filed in South Africa. Unlike many other jurisdictions, South Africa has no legal requirements for disclosure of lobbying activities.

It is crucial that South Africa urgently achieve policy alignment to support a just transition to a low-carbon, climate-resilient economy, and shareholders and other stakeholders should be made aware of any activities that interfere with climate-aligned national policy-making.

Globally, investors are waking up to the role that industry associations have played in frustrating progressive climate policy and slowing down climate action. Increasingly, investors are demanding to know how investee companies address misalignment between their publicly-stated climate commitments – and the Paris goals – and the lobbying activities of their industry associations. Both the PRI and the Institutional Investors Group on Climate Change, for example, have published their expectations for corporate climate lobbying, and emphasised the importance of transparency and reporting on direct and indirect climate-related lobbying.

Sasol’s 2020 assessment of its alignment with industry associations does not provide enough information for its stakeholders to form an independent view of Sasol’s review process, or its findings.

It is clear that Sasol will continue to have significant influence over climate policy in South Africa – directly and through its industry associations. Its stakeholders must have confidence that the company is using its influence to align South Africa’s climate policy with the Paris goals. As things stand, the information required to make this assessment is not publicly available.

It is also important that investors be able to better appraise Sasol’s long-term investment proposition, and its stated commitment to Paris alignment and to a just transition. This resolution requests that Sasol provide its shareholders with information that will help them determine not only whether Sasol’s own climate lobbying positions and activities, and those of its industry associations, are aligned with the Paris goals, but, importantly, the circumstances in which it would discontinue membership of an association on the basis of misalignment with the Paris goals.

Author: Bryan Groenendaal

Source: Just Share


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