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Climate change

Our approach to climate change is integrated with our strategy and is designed to protect and unlock long-term value, enhance our competitiveness in a low-carbon world and build operational resilience.

 

As a global mining and metals company, we have an important role to play in responding to the risks and opportunities of climate change: to produce commodities that are critical in the transition to a low-carbon world; and to do so in a way that seeks to contribute value to society and minimise environmental impact. 

We support the objectives of the Paris Agreement. We have set a target1 to halve our operational GHG emissions (Scopes 1 and 2) by 2035 from our FY21 baseline. We also have a long-term goal to achieve net zero GHG) emissions across all scopes (i.e. Scope 1, 2 and 3) by 2050.

We have committed to not develop or invest in any greenfield metallurgical coal projects or any new greenfield energy coal basins.

 

Our approach to climate change

Our approach to climate change is aligned to our purpose and integrated with our strategy, and is focused on:

 

Reshaping our portfolioExpandCollapse

Reshaping our portfolio toward commodities critical in the transition to a low-carbon world is a key part of our approach to addressing climate change.

We have exited, or ceased production at, a number of carbon intensive and lower returning businesses, and increased our exposure to commodities critical for a low-carbon world through our acquisition of a 45 per cent interest in the Sierra Gorda copper mine and increasing our low-carbon aluminium production capacity. 

In FY24, we achieved major milestones in the transformation of our portfolio for a low-carbon future - our decisions to develop Hermosa’s Taylor zinc-lead-silver deposit and sell our metallurgical coal business and interest in the Eagle Downs metallurgical coal project.  

In addition to further streamlining our portfolio and reducing our exposure to hard-to-abate Scope 3 GHG emissions from the steel making value chain, these divestments will strengthen our balance sheet, unlocking significant capital to invest in growing our base metals volumes.

Decarbonising our operationsExpandCollapse

Our operational decarbonisation pathway to support the achievement of our 2035 target and 2050 net zero goal consists of short-, medium- and long-term initiatives focused on improving energy efficiency, transitioning to low-carbon energy, and developing technology solutions. 

Our FY24 reported operational GHG emissions of 20.3 Mt CO2-e decreased 6% from FY23 levels and 2% from our FY21 baseline. Following the sale of Illawarra Metallurgical Coal, the updated FY21 baseline for our 2035  target will be 18.2 Mt CO2-e. 

Our decarbonisation approach applies the mitigation hierarchy, meaning that we seek to prioritise avoidance and mitigation over the use of carbon offsets.  

81 per cent of our FY24 operational GHG emissions were generated in our aluminium value chain. We continue to focus on decarbonisation programs and initiatives at these operations.  

Just transition

The concept of a just transition reflects the imperative of managing the social impacts, risks and opportunities of the transition to a low-carbon world. It is an approach to decarbonisation that seeks to centre the interests of those that are most affected by it, including workers, communities, and suppliers of goods and services. 

We are committed to supporting a fair and equitable transition that is aligned with the objectives of the Paris Agreement. Our just transition guiding principles were developed to help guide and inform our decarbonisation planning and decision making.  

Read more about how we are working to decarbonise our operations and our approach to Just Transition in our 2024 Sustainable Development Report.  

Working with othersExpandCollapse

Scope 3 

In FY23, we set a goal of net zero Scope 3 GHG emissions by 2050 that includes all categories of Scope 3 GHG emissions relevant to our business. This goal recognises our role in contributing to the decarbonisation of the value chain and reflects our commitment to collaborating with value chain partners towards actions and innovations required to address Scope 3 GHG emissions. 

Our areas of focus remain: 

  • Improving the quantification of our Scope 3 GHG emissions inventory; 

  • Collaborating with suppliers on reducing GHG emissions in the supply chain; 

  • Collaborating with customers on reducing GHG emissions, particularly relating to processing of our sold products; 

  • Maturing our monitoring program for shipping GHG emissions; and 

  • Participating in stewardship and innovation initiatives.

Read about our approach to addressing Scope 3 GHG emissions in our 2024 Sustainable Development Report. 

Advocacy and our climate change positions 

We engage on climate change related policy through direct advocacy, such as engagement with policy makers and submissions to regulatory and policy reforms proposed by governments, and indirect advocacy though our participation in industry associations. 

We are committed to conducting direct advocacy and expect our industry associations to conduct advocacy activity in line with our climate change positions. Since 2019, we have undertaken an annual review of our member industry associations’ positions on climate change to evaluate alignment with our own positions, strategy and values. 

Learn more about our approach to industry associations and our FY24 review here. 

Assessing physical climate riskExpandCollapse

Physical climate risks are driven or intensified by weather, climate variability and/or climate change. They include acute risks, resulting from changes in the frequency, intensity or location of extreme weather events (e.g. drought or flood events) and chronic risks, resulting from longer-term changes in climate patterns (e.g. sustained higher temperatures, sea level rise). 

In FY24, we experienced two extreme weather events that caused operational disruption at two of our sites, specifically impacts associated with Tropical Cyclone Megan at Australia Manganese and an extreme rainfall and flooding event at Cannington.  

In response to these events, we are conducting a review to draw any specific additional improvement opportunities for our broader approach to planning and resilience. We will continue to work to integrate these and other continuous learnings into our business-as-usual activities and progress our work plan to improve the resilience of the business against the physical impacts of climate change.

Read about our approach to managing strategic risks related to potential physical impacts of climate change in our 2024 Sustainable Development Report. 

Climate Change Action Plan

Climate Change Action Plan 2022

Our Climate Change Action Plan (CCAP) was published in our 2022 Sustainable Development Report (SDR)

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Please read page 69 of the 2022 SDR for important information on the preparation of our CCAP and forward-looking statements, scenario analysis and information prepared by third parties that are covered in our CCAP. The CCAP should be read in conjunction with South32’s SDR, Annual Report and Sustainability Databook, and other periodic and continuous disclosure announcements lodged with the ASX. Those documents are available here, and our ASX announcements can be found here.

In 2022 we published our first Climate Change Action Plan (CCAP), which describes our approach and the actions we are taking to address the risks and opportunities that climate change presents for our business. 

The CCAP was published in our 2022 Sustainable Development Report (SDR). Read page 69 of the 2022 SDR for important information on the preparation of our CCAP and forward-looking statements, scenario analysis and information prepared by third parties that are covered in our CCAP. The CCAP should be read in conjunction with our SDR, Annual Report and Sustainability Databook, and other periodic and continuous disclosure announcements lodged with the ASX. Those documents are available here, and our ASX announcements can be found here. 

The CCAP was put to a non-binding advisory vote at our 2022 Annual General Meeting, receiving strong shareholder support with 89.6 per cent of the votes cast in favour of the resolution. We are currently working to develop our next CCAP and intend to put it to a non-binding advisory vote at the 2025 Annual General Meeting. 

Read about the work we have been doing towards delivering the commitments and actions outlined in our CCAP in our 2024 Sustainable Development Report. 

Other key documents

Milestones on our road to net zero

Within a year of South32's establishment, we committed to supporting the goals of the Paris Agreement. We are preparing our business for the global energy transition, taking action to meet our climate change commitments and working to enable a just transition for our people, our business and our communities.

2016

Set our long-term goal¹ to achieve net zero operational GHG emissions (Scope 1 and 2) by 2050

2021

Achieved our first GHG emissions reduction target² of keeping our Scope 1 GHG emissions below our FY15 baseline

2035

Meet our target of halving our operational GHG emissions, compared to our FY21 baseline

2050

Achieve our goal of net zero GHG emissions (Scope 1, Scope 2 and Scope 3)

Climate change governance

Climate change governance

Climate change is a material strategic and governance issue for South32 that is overseen by our Board with the support of its standing Committees.  

Our Board approves our overall climate change approach, including our CCAP and the public commitments and policy positions therein.  Together with the Sustainability Committee, the Board oversees the governance, strategy, risk management and performance of the Group with respect to material climate-related risks and opportunities. 

Our CEO, together with the Lead Team, is accountable for developing and implementing our CCAP. They assess and report to the Board and its Committees on the impact of material climate-related risks and opportunities, including the climate resilience of our strategy and business model and implications for our financial position and performance. 

Read more about our climate governance in our 2024 Sustainable Development Report. 

Executive remuneration 

Since FY22, 20% of the long-term incentive portion of the remuneration of our CEO and Lead Team has been directly linked to our performance on climate change and the transition of our portfolio towards commodities required for a low-carbon  world.  

Learn more in our Remuneration report in our Annual Report 2024. 

Climate stories

Our Climate Change Action plan

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Monitoring our shipping emissions

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Worsley Alumina converts first boiler from coal to natural gas

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At South32, we understand the need for bold action on climate change

and we are responding by addressing our biggest challenges. Our Climate Change Action Plan describes how we are working in collaboration with our stakeholders to prepare our business for the global energy transition, meet our climate change commitments and achieve a just transition for our people, our business and our communities." - Karen Wood, Chair
Karen Wood, Chair of South32

Footnotes

1 ‘Goal’ is defined as an ambition to seek an outcome for which there is no current pathway(s), but for which efforts will be pursued towards addressing that challenge, subject to certain assumptions or conditions.

2 ‘Target’ is defined as an intended outcome in relation to which we have identified one or more pathways for delivery of that outcome, subject to certain assumptions or conditions. 

This page contains forward looking statements including statements in relation to climate change and other environmental and energy transition scenarios. These forward-looking statements reflect South32’s expectations at the date of the Climate Change Action Plan included in the 2022 Sustainable Development Report (including with respect to its strategies and plans regarding climate change) and they are not guarantees or predictions of future performance or outcomes or statements of fact. They involve known and unknown risks and uncertainties, which may cause actual outcomes and developments to differ materially from those expressed in such statements. South32 makes no representation, assurance or guarantees as to the accuracy, completeness or likelihood of fulfilment of any forward-looking statement, any outcomes expressed or implied in any forward-looking statement or any assumptions on which a forward-looking statement is based.

Related information

Sustainability approach

Our approach to sustainability focuses on areas that are material to our business and stakeholders.

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Our people

We are committed to working together safely, creating an environment where our people are supported to speak up, and building an inclusive and diverse workforce.

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Communities and society

Adding meaningful contributions to people’s lives by creating lasting social, environmental and economic value.

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Operating ethically

Our focus is on building strong, mutually beneficial and trusting relationships with our stakeholders.

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Environment

We are committed to protecting natural resources including water, biodiversity, air and surrounding ecosystems.

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Sustainability disclosure requirements

We are preparing our business for the global energy transition, meeting our climate change commitments and achieving a just transition for our people, our business and our communities.

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