Glencore has a warming climate of distrust

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The Glencore logo is pictured in Baar, Switzerland, November 20, 2012. REUTERS/Arnd Wiegmann/File Photo

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LONDON, April 29 (Reuters Breakingviews) - Glencore (GLEN.L) Chief Executive Gary Nagle’s climate credibility is under attack. Nearly a quarter of shareholders voted on Thursday against the 64 billion pound mining giant’s plans for reducing carbon emissions, mainly by gradually shutting coal mines up to 2050. Significantly, the conscientious objector camp was four times larger than a year ago, even though Glencore’s goals have actually toughened up. One conclusion is that investors think they’re still not tough enough – the International Energy Agency says even developing countries should stop burning coal by 2040, not 2050. Another conclusion is that investors may not trust Nagle to stick to them.

One obvious factor in the interim is November’s Glasgow climate summit, which sharpened the focus on rapid coal exits. But another is the skyrocketing price of coal. Even before Russia’s invasion of Ukraine, Nagle reckoned the fossil fuel might yield $10 billion of EBITDA this year, double 2021. And those projections were based on coal at $175 a tonne. In March, it topped $400. Shutting mines unearthing vast amounts of cash makes the environmental cause a more expensive one. But that only renders Glencore’s protest vote more striking. (By Ed Cropley)

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(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)

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Editing by George Hay and Oliver Taslic

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