Glencore bows to climate change pressure to cap coal production

Commodity giant Glencore will cap thermal coal production following pressure from investors worried about climate change.

The FTSE 100 giant, the world’s largest supplier of coal, on Wednesday said it would not exceed current production levels from now on. The company, which has ramped up production in recent years, churns out about 150 million metric tons a year.

The move is part of a broader push to get onside with investors increasingly vocal about climate change.

Glencore said investing in climate change-proof assets was necessary to “deliver a strong investment case”.

The company, led by Ivan Glasenberg, said it had consulted a shareholder action group called Climate Action 100+, which speaks for 300 investors who run more than $30 trillion.

Other plans unveiled today by the Swiss-based company include a promise to outline by 2020 how investments comply with the UN’s Paris Agreement on climate change. It will also review membership of lobby groups which may undermine the Paris accord.

Glasenberg said coal would remain an important part of Glencore’s portfolio. Shares rose 3% after it unveiled fresh plans for a $2 billion buyback.