EDO could be stripped of charity status over Santos legal challenge court loss

The EDO could be stripped of its charity status if the non-profit commission finds it breached public trust and failed to act responsibly in its legal challenge against Santos.

Opposition resources spokeswoman Susan McDonald. Picture: Tracey Nearmy

The Environmental Defenders Office could be stripped of its charity status if the non-profit commission finds it breached public trust and failed to act responsibly when it tabled heavily flawed evidence in a failed legal challenge against oil and gas producer Santos.

Opposition resources spokeswoman Susan McDonald has written to the Australian Charities and Not-for-profits Commission to request an investigation be launched into the environmental litigator with a “view to its deregistration as a charity”.

After the EDO’s legal bid to block Santos’s $5.8bn Barossa gas project in the Timor Sea collapsed because of allegations of witness coaching and the manufacturing of evidence, Senator McDonald has argued the green activist group’s conduct represented a “serious failure in governance”.

Ms McDonald has written to the Australian Charities and Not-for-profits Commission to request an investigation be launched into the environmental litigator. Picture: Brendan Radke

The Federal Court ordered the EDO to pay the more than $9m in legal costs racked up by Santos in defending itself in the claim brought against it by the EDO on behalf of Tiwi Islanders.

Academics and activists providing evidence for the EDO were found to have fabricated claims the pipeline would interfere with a rainbow ­serpent and crocodile man ­songline map, based on minimal consultation.

Senator McDonald argued the EDO’s conduct breached the commission’s governance standards, including a requirement for a charity’s management to act with “reasonable care and diligence” and “honestly and fairly in the best interests of the charity and for its charitable purposes”.

“The above conduct and findings and consequences warrant – if not already being undertaken – an urgent investigation of the EDO by the commission, with a view to reviewing its entire registered charity status,” Senator McDonald said in the letter.

“The conduct – and failure to manage and identify inappropriate conduct – arguably represents a serious risk to public trust and confidence in the sector, and a failure of the charity’s responsible people to guide and monitor management of the charity, in keeping with governance standard No 5.”

EDO chief executive David Morris said it was Senator McDonald’s “prerogative to make any referrals she deems fit”.

“EDO is a politically unaligned community legal service that proudly gives people the access to justice usually only available to the rich and powerful,” he said.

The failed court case has inflicted a significant financial hit to the EDO, with the organisation posting its June 2024 financial report with the charities commission on Friday, reflecting an almost $8.6m loss.

Opposition environment spokesman Jonathon Duniam at Parliament House in Canberra. Picture: NewsWire/Martin Ollman

“There is a material uncertainty regarding the entity’s future financial performance and its ability to refinance and/or repay the $6.5m expected debt by the due date (August 2027),” the fin­ancial report said.

“Given the circumstances described, a material uncertainty exists that may cast significant doubt on the EDO’s ability to continue as a going concern.”

The financial report also revealed its funding grants from overseas had soared to $6.1m last year, outstripping its Australian grants worth $5.3m. The EDO also received $4.1m in donations.

Opposition environment spokesman Jonathon Duniam criticised the Albanese government for funding the EDO by about $2m a year and enabling its “shameful behaviour”, accusing Labor of effectively “bailing out” the organisation from its failed court case.

“The EDO’s green lawfare is seriously impacting the economic opportunities that communities like those on the Tiwi Islands deserve,” he said. “The EDO is not reminiscent of a typical mum and dad charity that seeks to do practical things to save the environment. Rather, they are trying to stop environmentally responsible projects from occurring through the courts, costing the country millions, if not billions of dollars, for no good reason.”