Guest essay by Eric Worrall
Mixed signals anyone? As debate rages over the Aussie government funding a new gas generator, businesses are being coerced to increase their disclosure of alleged climate risks.
ASIC targets fossil fuel companies over climate change
Senior companies reporter
Jun 1, 2021 – 4.45pm
A $700 million oil and gas exploration group chaired by Future Fund guardian John Poynton and National COVID-19 Commission boss Nev Power was one of five fossil fuel firms warned by the corporate regulator they risked breaking the law because of non-disclosure of climate change risks.
The intervention by the Australian Securities and Investments Commission in mid-2020 was among the regulator’s first forays into the market as it ramps up its regulation of climate-related disclosures for shareholders.
The warnings were all triggered by complaints received by ASIC that alleged the companies’ operating reviews and directors’ reports failed to disclose risks posed to the businesses by climate change. While auditors do not audit directors’ reports in the annual reports, they are required to ensure any information in a director’s report is consistent with the audited operating and financial review.
In his letters, ASIC senior manager Ben Phillips warned Strike Energy, Carnarvon Petroleum, Pancontinental, Whitebark and Leigh Creek that the companies’ 2019 annual reports were “inconsistent and out of step” with other energy companies “without any clearly discernible explanation as to why this might be the case”.
In my opinion this contradiction is straight out of Atlas Shrugged.
The Australian Government is utterly dependent on revenue from extractive industries, yet some government bodies appear to be doing everything in their power to kill the industries which pay their wages. Just losing coal exports would turn Australia’s comfortable current account surplus into a deficit.
Yet even as one half of the government seeks to prop up dispatchable power with subsides, the courts and regulators are attempting to throw absurd new obstacles in the path of companies delivering prosperity to the Australian people.
Much as I detest the possibility Australia would follow Biden’s path to high cost climate non-achievement, in some ways what the Aussie government is doing right now is even worse.
Imagine you were a fossil fuel investor, or even a renewable investor. What would your answer be, if someone asked whether Australia was offering a stable regulatory environment, to encourage job creating investment in the Australian economy?