BHP recommits to diversity, ESG initiatives

Australia’s biggest company has just made a big call on its ambitions and it could influence corporates everywhere.

Mining giant BHP is doubling down on its commitment to diversity, equity and inclusion (DEI) initiatives despite bubbling investor discontent over the controversial doctrines.

Chief executive Mike Henry, facing a question from an investor who pleaded for the company to reject DEI and return to “meritocracy”, argued the company’s diversity policies had boosted “operational performance” and rejected the position there was a disconnect between DEI aspirations and delivering shareholder returns.

“At the same time we have been focused on those things, company performance has lifted,” he said.

“We’ve gone from being an operational laggard in the industry to now leading the industry when it comes to our op performance. Returns for shareholders have been strong.

“And so not only do I believe both things can be achieved in parallel, I believe that what is required to achieve some of those things actually boosts underlying performance as well.”

BHP chairman Ken MacKenzie and chief executive Mike Henry face the music at the company’s annual shareholder meeting. Picture: NCA NewsWire / Emma Brasier

The $214bn behemoth is pursuing a range of diversity and environmental, social and governance commitments, from a gender balanced workforce by 2025 to net-zero operational emissions by 2050.

It also backed last year’s Voice to Parliament proposition, though some investors expressed frustration at the position and said the company’s pro-Voice stance had created a fissure between management and shareholders.

BHP chair Ken MacKenzie, speaking at the company’s shareholder meeting in Adelaide in November, argued there were “clear business reasons” for backing constitutional change.

“We operate on the traditional lands of Indigenous peoples,” he said.

“These are critical relationships.”

A push for more diverse workforces has swept through corporate Australia in recent years, a response in part to reflect the country’s changing demographics and a sense traditionally organised workplaces may have unfairly shut out some workers from equal opportunity.

Female participation at BHP had moved from 16 per cent 2016 to about 35 per cent now, Mr Henry said.

“That is going to both boost and then support sustainable high performance for the company into the future,” he said.

Chief financial officer Vandita Pant is part of a growing female workforce at BHP. Picture: Supplied

BHP’s female workforce traverses the company hierarchy, from new apprentices at its Central Queensland coalfields to the upper echelons of the miner’s leadership structure, including chief financial officer Vandita Pant and Australia president Geraldine Slattery.

Mr Henry also reaffirmed the company would spend money to hit net-zero operational emissions by 2050 and was working with equipment manufacturers to deliver battery electric trucks and locomotives to its mine sites at the end of this decade.

BHP has already signed an MOU with car giant Toyota to electrify its 5000 diesel-powered work vehicles.

It is also purchasing renewable energy to power its mine sites.

Mr Henry and Ms Pant said the company would “partner” with its steelmaking customers on low carbon technologies to lower scope 3 emissions.

“We are working very hard to make sure that we are very much across all of these technologies, which over the next few decades will start to come in as steel decarbonises,” Ms Pant said.

In Australia, BHP operates coalmines in Queensland and NSW, iron ore mines in Western Australia and copper mines in South Australia.