Our Responsible Investment overlays
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Focus theme: Climate
Example case of a climate engagement: Antofagasta
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Background: We have repeatedly engaged with Chilean mining company Antofagasta in recent years on topics related to labour rights and worker safety, water management, and climate risk. Over the course of these engagements, we have seen Antofagasta implement numerous positive initiatives. Engagement: We recently followed up with Antofagasta to continue the dialogue on its efforts to reduce greenhouse gas emissions – particularly as the company has announced it is adopting new, longer-term carbon reduction targets and strategies. As Antofagasta has recently entered the bond market, we also had an exploratory dialogue around the relevance of green or sustainability-linked bond structures for future issuances. While positive dialogue is constructive, ultimately all engagement efforts must result in more ambitious commitments and action. Encouragingly, Antofagasta continues to take positive steps forward, such as recently announcing its goal to be carbon neutral by 2050. Importantly, the company is aiming to reduce total emissions by 30% by 2025. We sought to clarify how Antofagasta will be able to deliver on these ambitions. The company’s greatest challenge is in the ability to report on its indirect – ‘Scope 3’ – value chain emissions, but it is actively building its capability to report on these. Outcome: In response to our efforts, Antofagasta informed us it will shortly be releasing reporting in line with TCFD recom- mendations, which will highlight how its operations are aligned with various climate scenarios. We also remain in dialogue about its ongoing climate strategy and will continue to press on its decarbonisation progress. Overall, the advancements Antofagasta has made in relation to climate risks and other ESG elements recently led us to upgrade our internal ESG score on the company from B+ to A.
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