Danielle Ecuyer MR: Gunns pulpmill profits could be wiped out with a conservative cost of carbon …
MS ECUYER, Women For Change Alliance representative and investor says GUNNS’ proposed Tamar Valley pulp mill will generate an estimated 10 million tonnes of CO2 per annum.
Applying a conservative cost of carbon, $20 per tonne, will add an additional $200 million in costs to the mill each year.This could be much as the forecast earnings on the mill before interest, tax, depreciation and amortisation (EBITDA changes depending on costs of production, pulp mill prices and the exchange rate.)
Danielle Ecuyer, an ex investment banker, Perpetual shareholder and investor in Perpetual’s wholesale industrial fund, Gunns largest shareholder, has been trying to highlight the Carbon Risks to
Perpetual. Ms Ecuyer’s last letter had 150 signatures from Financial Advisers and concerned investors, highlighting carbon and other risks associated with the proposed Gunns pulp mill.
Perpetual CEO, David Deverall and Chief Investment Officer, Emilio Gonzalez are refusing to meet with Ms Ecuyer or provide any answers to her concerns.
Ms Ecuyer sights that in the USA “Investors representing more than US $1.5 trillion have lined up to petition the Securities and Exchange Commission to require companies to disclose their financial risks due to climate change.”
See: Read more here
US investors realize that Climate Change and a cost of carbon pose real and definable threats to corporate profitability and it is no longer acceptable that companies or major fund managers, like Perpetual ignore these risks. Perpetual is clearly not meeting its fiduciary responsibility by not looking after investors best interests, in ignoring the biggest risks facing corporates globally,
Climate Change and a cost of carbon.
Ms Ecuyer also highlights that native forests are nature’s carbon sinks. Global deforestation accounts for around 20% of global CO2 emissions, and the cessation of native logging, which Gunns
undertakes, is one of the easiest ways to decrease emissions.
“Curbing deforestation is a highly cost-effective way of reducing greenhouse gas emissions and has the potential to offer significant reductions fairly quickly.”
Stern Review into Climate Change, October 2006.
Conversely logging wet native forests for pulp feedstock results in CO2 emissions which are at risk of being subjected to a cost of carbon.
Financial institutions like Perpetual, Gunns largest shareholder and ANZ, banker to Gunns have a responsibility to their shareholders and clients to take these risks seriously and engage in construction
dialogue with concerned stakeholders, like Ms Ecuyer.
