Billionaire Mike Cannon-Brookes reignites climate feud with Australia’s biggest emitter

Billionaire investor Mike Cannon-Brookes has reignited his climate battle with AGL, Australia’s biggest polluter, rejecting its latest emissions-reduction strategy as too slow and out of step with what is needed to arrest dangerous global warming.

Cannon-Brookes, the co-founder of tech firm Atlassian and one of the country’s richest people, built a stake of more than 10 per cent in AGL in 2022, before leading a successful push to overhaul its board of directors and extract pledges for faster coal-fired power plant closures and deeper cuts to harmful greenhouse gas emissions.

The rift between AGL and its biggest shareholder opened again at the energy giant’s annual general meeting on Friday, when Cannon-Brookes defied the urging of the board and refused to endorse its climate change strategy, which he described as inadequate.

His private investment firm, Grok Ventures, said AGL’s commitments were “largely unchanged” from two years ago, and still were not aligned with the international Paris Agreement’s ultimate aim of limiting rising temperatures to 1.5 degrees, the level that scientists say is key to avoiding the worst and most immediate impacts of climate change.

“The plan shows only incremental improvement in ambition when compared with 2022, is not aligned with the Paris Agreement, and still targets net zero by 2050 on a stated 1.8-degree trajectory,” a Grok spokesperson said.

“We firmly believe a more ambitious path to renewable energy best serves the long-term interests of AGL’s shareholders.”

Cannon-Brookes’ rejection of the climate plan on Friday marks the latest escalation of a campaign that began in 2022 when he amassed a large stake in AGL and fought to scuttle a planned demerger that would have kept the company’s coal-fired power fleet running until well into the 2040s.

AGL, which supplies electricity and natural gas to more than 4 million customers across Australia, is also the nation’s single biggest emitter of harmful greenhouse gases due to its ongoing ownership of two large coal-burning power generators in Victoria and NSW.

Facing pressure from Cannon-Brookes and other investors, AGL eventually abandoned its demerger and brought forward the closure date of its Bayswater coal generator in NSW to no later than 2033, while the retirement of the Loy Yang A plant in Victoria’s Latrobe Valley was brought forward by up to 10 years from 2045 to 2035. The company also committed billions of dollars to build 12 gigawatts of backed-up renewables by that time.

Grok on Friday said it commended AGL management for its “progress to date”. Its vote against AGL’s latest climate plan, Grok said, was to express its view that “more is needed – in targets, speed and action – to give investors clarity in confidence in AGL’s pathway through the critical next half-decade”.

Grok’s votes accounted for most of the proxy votes that opposed AGL’s climate plan on Friday, while about 70 per cent of votes supported it.

The updated climate plan won the backing of the influential proxy firms that guide institutional investors on how to vote. It included a strengthening of AGL’s direct emissions reduction targets, as well as the introduction of a new target for a 60 per cent cut to Scope 3 emissions – those released by the end users of the electricity and gas that the company supplies – following its final exit from coal. AGL also committed to bring forward the deployment of some of its planned new renewable energy capacity, aiming to build six gigawatts rather than five gigawatts of capacity by 2030, at least half of which would be grid-scale batteries.

A spokesperson for AGL on Friday said the company had been engaging with a wide range of shareholders and governance advisers about its “multi-decade strategy”, including its climate plans, and was pleased with the strong support it had received at the meeting.

“Overall, our climate transition action plan was broadly supported by shareholders,” the spokesperson said. “AGL respects that there are a variety of perspectives on our climate transition action plan, which is not unexpected given the complexity of the energy transition.”

The Australasian Centre for Corporate Responsibility, a shareholder activism group, said the “sizeable” vote against AGL’s climate strategy should send a signal to the board and its executives that they must do more to help drive the clean energy shift.

“AGL must move quickly to deliver real emissions cuts and a more compelling strategy that seizes the opportunities of the energy transition,” the group’s director, Brynn O’Brien, said.

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