Friday 7 October 2022
RESPONSE TO AGL NOTICE OF MEETING
It makes no sense to us – or a growing list of shareholders – that the Board is rejecting highly-qualified, independent directors who are committed to helping them make AGL the leading green gentailer in the world.
It’s yet another poor decision that doesn’t seem to be rooted in logical business decisions and certainly ignores the threats and opportunities facing AGL.
Grok believes even with the endorsement of Mark Twidell to the Board, renewal is not complete and we disagree that the incumbent Directors have the breadth of skills required to execute on this transition. They quite simply need more help, particularly with execution which has been underwhelming to this point.
Grok Ventures welcomes the endorsement of Mark Twidell to the Board of AGL. Mark will add much-needed capabilities in behind the meter, battery technology and renewable generation to the Board.
But the size of the task cannot be underestimated. Grok will continue to support the nominations of independent directors Dr John Pollaers OAM, Dr Kerry Schott AO and Christine Holman who have extensive experience in these areas.
These three candidates bring much needed skills to the table that include:
To be clear, as AGL’s largest shareholder, Grok is committed to working with the Board to help effect the necessary changes and make the most of the decarbonisation opportunity. Part of this commitment was to help find independent director candidates with the skills the company requires for this transition.
John Pollaers, Kerry Schott, Mark Twidell and Christine Holman have no alignment with Grok other than broadly agreeing with our view – and that of AGL shareholders – that this transition needs to occur as quickly as possible and with an ambition for AGL to lead Australia’s energy transition. If executed correctly, this will deliver significant value for AGL’s 150,000 shareholders, the vast majority of whom are retail investors.
The strategic review was a step in the right direction - but it was not ambitious enough in providing for a plan that delivers below 1.5 degrees. The strategy also emphasises a centralised operating model (i.e. replacing coal with utility scale solar and batteries) and fails to lean into the behind the meter opportunity. The Australian Energy Market Operator forecasts 75% of dispatchable capacity will come from behind the meter (i.e. from energy customer premises) by 2050 - this represents a transformational opportunity for AGL’s business model and more importantly, for its customers. AGL’s leadership in Australia’s energy transition was absent from the strategic review.
Grok will be engaging directly with AGL’s 150,000 shareholders in the lead up to the AGM to explain the merits of looking to fresh faces to provide a broader mix of skills and experience - as well as additional capabilities to undertake the monumental amount of work required by the Board.
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