The divestment of mining shares by Australia’s National University (ANU) has drawn criticism from a number of fronts, most notably from Sandfire Resources who have threatened legal action against the university.
ANU announced last week that it would divest shares in seven mining companies, in a move pushed by student activist group ‘Fossil Free ANU’ and the international fossil fuel divestment campaigners 350.org.
The companies were selected by ANU on the basis that they were 'not socially responsible and doing harm'.
Of the seven companies named in the divestment of around $16 million worth of shares, only two, Santos and Oil Search, are companies involved in the production of fossil fuels.
The other companies are Newcrest Mining (gold), Iluka Resources (mineral sands), Sandfire Resources (copper, gold), Independence Group (nickel, gold), and Sirius Resources (Nickel, not yet producing).
The university’s move to distance itself from mining industry investment did not include BHP Billiton, which is a corporate donor to the university.
The $16 million worth of shares represents only 1.6 per cent of ANU’s estimated $1 billion worth of investments.
The decision to divest resource investments was based on the rankings of independent investment research group CAER (Corporate Analysis, Enhanced Responsibility), which was commissioned by the university to undertake research into the social responsibility of the companies.
In May this year Iluka Resources won the South Australian Premier’s Award for Environmental Excellence, for research partnerships to promote industry best practice at the Jacinth-Ambrosia mineral sands operation.
Sirius Resources has been commended as an industry leader by indigenous consulting company Indigenous Services Australia, for their sensitivity and respect in negotiating for land use with the Ngadju people, as well as achieving positive social outcomes for them as traditional owners of the land covered by the exploration lease for the Nova Nickel Project.
Sydney-based Oil Search administers United Nations health care funds, and is listed on the Dow Jones Sustainability index (Australia) and the UK-based Alliance Trust Sustainable Future Global Growth Fund.
Sandfire CEO Karl Simich said that the company was not contacted by CAER prior to ANU’s decision, and were only able to obtain a copy of their company profile from CAER on Wednesday.
“Yes, we will take further action in a formal capacity, and we will be seeking a full retraction of the statements made by the ANU.
“When you make comments that you're not interested in investing in companies that cause social harm, that is something we take umbrage at.
“It really is a distressing statement to hear, from an institution that actually provides (university) courses for people who will enter the mining industry.”
Association of Mining and Exploration Companies (AMEC) CEO Simon Bennison said the decision by ANU to publically blacklist the companies was an inappropriate reaction to a flawed report.
“ANU commissioned CAER to prepare a report into environmental, social and governance ratings of various companies within their share portfolio.
“AMEC understands that ratings were assigned to a number of criterion based only on publicly available information.
“The fact that the nominated companies were not formally approached, afforded natural justice or the right of any reply, the decision making process by ANU is clearly flawed.
Bennison said AMEC was extremely concerned and disappointed that ANU chose to make a public statement on what should have been an internal decision making process.
“In the meantime, there is no question that the investment reputation of the companies involved has been tarnished,” he said.
“They have been vilified without credible evidence being provided to substantiate the conclusions in the Report.”
In a stroke of irony, ANU has been listed as the top carbon emitting university in the country, outstripping the carbon usage per student of other universities by as much as three times.
The Australian Financial Review this morning reported that of eight universities with published emissions levels for 2012-13, ANU ranked fourth highest with 101,000 tonnes of carbon dioxide equivalent in greenhouse gases.
Monash University produced 140,000 tonnes, but has three times as many students, while University of Melbourne produced 146,000 tonnes with twice as many students.
ANU claimed 20 per cent of their emissions are caused by Australia’s largest supercomputer, housed at ANU and used by the CSIRO, Geoscience Australia and the Bureau of Meteorology for climate science research.
AFR said that even if the supercomputer was excluded, ANU still produces more carbon per student than the research-intensive UNSW, which produced 65,000 tonnes for 52,000 students.
Images: The West Australia, Woroni