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Activists demand measures from Australian iron ore industry miners over steel emissions

Add Time:2019-03-08 19:53:00 Clicks:
The West reported that activist investors targeting Australia’s coal industry have put WA’s lucrative iron ore industry on notice, demanding big miners take responsibility for the emissions generated when their product is turned into steel. Friends of the Earth-backed group Market Forces is engineering a shareholder backlash if WA’s biggest iron ore miner, Rio Tinto, fails to set targets for greenhouse gas emissions including those downstream from iron ore production.

Market Forces asset management campaigner Will van de Pol said Rio chief executive Jean-Sebastien Jacques had good reason to be concerned about the company’s reliance on iron ore. He said “This is a simple matter of risk management that Rio Tinto needs to undertake for its shareholders. If Rio faces risks from its exposure to a commodity that is structurally challenged by action on climate change, it needs to plot a course to minimise that risk. Setting targets and plans to reduce the company’s indirect and downstream emissions will only protect it from transitional climate risk as the world moves to decarbonise the economy. Rio Tinto’s major climate change impact is through the emissions generated from the use of its iron ore in the steelmaking process. Given the market changes that can be foreseen as the world shifts to meet the goals of the Paris Agreement, industries like steelmaking face increasing structural challenges.”

Rio Tinto opened a Pandora’s box last week when it warned its biggest earner, iron ore, could be hit in a lower carbon-emission world set to start next year when the Paris Agreement kicks in. Rio’s climate change report noted changes to carbon policies could materially affect the value of Rio Tinto’s iron ore business.

That agreement aims to limit the increase in average global temperature to below 1.5C above pre-industrial levels.

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