Media Release: Report warns of legal risks for top Australian companies lobbying against climate action

A new report has found some of Australia’s biggest companies are directly and indirectly lobbying to water down, delay or block climate reforms and policies – opening themselves up to potential legal risks.

The report, released by Climate Integrity, compared the public climate commitments and lobbying activities of nine companies: AGL, Origin, Rio Tinto, Bluescope, Qantas, South 32, Woolworths, Coles and Telstra, including through their industry associations such as the Business Council of Australia . Half of the companies assessed were found to be making inadequate or incorrect disclosures about their lobbying.

When there is misalignment between a company's top-line claims of support for climate action and their lobbying, legal risks can include misleading or deceptive conduct claims, shareholder advocacy or tort-based claims.

Anti-climate lobbying undertaken by industry associations was the greatest source of misalignment and legal risk. In multiple cases, companies were found to have publicly supported a policy while simultaneously lobbying to weaken or delay legislation via an industry association. The CEOs of Rio Tinto, AGL and Origin sat on the boards of industry associations that explicitly lobbied to weaken policies that their companies publicly claimed to support.

Board directors without direct oversight of lobbying activities are blind to these potential legal risks and should pay close attention to managing misalignment with industry associations they are members of. In two thirds of the companies assessed, the board did not have oversight of climate lobbying.

Companies must publicly commit to aligning direct and indirect lobbying with public statements supporting climate action, ensure board-level oversight of lobbying activities, disclose all policy engagement activities, and review current processes and thresholds for industry association membership.

Claire Snyder, Director of Climate Integrity said:

“Companies' actions must match their words. Time and time again Australian companies have told us they are committed to climate action but behind closed doors they are simultaneously lobbying to weaken and delay legislation. This report must be a wakeup call to company directors on the legal risks of undermining climate policies and legislation directly or via their industry associations.”

“It is unacceptable that some of the biggest companies in Australia are obstructing and delaying Australia’s transition to net zero, contrary to their public commitments. These companies are involved in every aspect of our lives, from groceries, planes, mobile networks and steel. Consumers, investors and shareholders deserve to know if a public net zero pledge adds up to much at all.

Kirsty Ruddock, Managing Lawyer – Safe Climate (Corporate and Commercial) at the Environmental Defenders Office said:

“Companies with net zero pledges must ensure their lobbying activities are aligned with their public climate commitments or face risks of actions against the company for misleading or deceptive conduct, increased shareholder advocacy or even the tort-based claims against companies involved in serious climate misinformation that we have begun to see around the world”