Major investors are challenging Woodside Energy’s climate strategies ahead of the company’s AGM.

With Woodside Energy’s Annual General Meeting (AGM) approaching this Wednesday, significant dissent looms among shareholders over the company’s climate policies. 

Influential global investors, including Norway’s KLP and the UK’s LGIM, have openly declared their intentions to vote against the Australian oil and gas giant’s climate transition strategies.

Expressing their dissatisfaction, KLP, Norway's largest pension fund, criticised the company’s current approach. 

“There is no way to achieve the climate objectives of the Paris agreement without a drastic decline in the burning of oil and gas,” KLP stated, calling for  significant reduction in fossil fuel production.

Woodside’s strategy has been described by its critics as excessively reliant on carbon offsets and not sufficiently aligned with the Paris climate agreements. 

This criticism comes at a time when the company has plans to develop new fields, suggesting an expansion in fossil fuel production rather than the reduction many see as necessary.

The forthcoming AGM will include a non-binding vote on Woodside’s climate report, a significant point of contention since the last similar occasion two years ago saw a substantial 49 per cent protest vote. 

Market Forces, a vocal critic of Woodside’s policies, pointed out the company's persistent expansion plans despite previous shareholder backlash. 

“Woodside has failed to respond adequately to world-record shareholder backlash on non-binding climate votes, doubling down on climate-wrecking gas growth plans,” said Will van de Pol, chief executive of Market Forces. 

He called for increased pressure on the company’s directors to realign its growth strategy, particularly through binding votes on directors and the company’s remuneration scheme.

While some, like the superannuation fund HESTA, support Woodside chairman Richard Goyder, the broader investor dissatisfaction indicates a potentially turbulent AGM. 

Woodside defends its strategy, with a spokesperson saying’ “Goyder and his leadership team had held numerous ‘direct engagements’ with shareholders on climate strategy and governance, and listened carefully to investors”. 

“The Woodside board believes Mr Goyder is a highly capable and effective leader, and continues to provide valuable insight, stewardship and strength to the board and its deliberations generally as a result of his extensive business career and board experience.”

Woodside says that putting its climate disclosures to a shareholder vote at this year’s AGM is “not required by law or a feature of common market practice, but is something that our investors specifically asked for and we have met this commitment”.

CGI Glass Lewis and the Australasian Centre for Corporate Responsibility (ACCR) have recommended voting against the climate report and Goyder's re-election.