9 Questions asked at 2021 BHP AGM

November 12, 2021

Here is the text of the 9 questions I asked at the 2021 BHP AGM, held on November 11.

1. Did any of the 5 main proxy advisers in the Australian market - ACSI, ASA, Ownership Matters, Glass Lewis and ISS - recommend a vote against any of today's resolutions? Has their been a material proxy protest vote against any of today's resolutions? Why not follow ASA guidelines and disclose the proxy votes before the debate on today's resolutions so shareholders can ask questions if there have been any protest votes?

Answer: no help from the chair who didn't really understand the question.

2. Why did you send the 312 page annual report to shareholders who haven't signed up for electronic communications when Australian law this year only required a one page letter alerting shareholders to the online materials. How was this sustainable and cost effective practice? Why not just send the 50 page notice of meeting, given that is what the AGM is about?

Answer: chair claimed annual report only went to those who opted in. So why did I get one?

3. Well done for finally committing to unifying but why did it take this long? Don Argus was the chair of two companies which created merger-driven DLCs around 20 years ago - Brambles and BHP. Brambles unscrambled their DLC in 2011 yet we waited another decade? Why?

Answer: A detailed response explaining that UK business now only produces 5% of the profit and the cost of unification has fallen by $US1.2 billion.

4. Best practice AGM transparency is now moving to providing a full transcript of the AGM, not just access to an archive of the webcast which is time consuming to wade through. Will BHP follow the lead of companies like Woolworths, Crown Resorts, AGL and ASX move to best practice by publishing a full transcript of today's AGM for the first time.

Answer: no commitment.

5. The WA State Government has about $50 billion of debt, even after iron ore royalties jumped from $1.1 billion in 2007-08 to almost $10 billion in 2020-21. With total WA iron ore production hitting almost 900 million tonnes in 2020-21, generating revenues of more than $200 billion and pre-tax profits of more than $100 billion, is it politically sustainable to stave off future royalty increases or another resources super profits tax proposal? Is there another resources jurisdiction in the world which has been so profitable for those private companies given a licence to access a state owned resource?

Answer: detailed answer from chair Ken MacKenzie acknowledging that public balance sheets have been impaired by COVID but returning to the old line of capital being scarce and countries needing to compete for it by keeping their costs down.

6. Do Ken and the board like the annual election of directors as required under UK law and will this be continued voluntarily after the re-unification back to Australia, where directors get 3 years terms. Could Ken comment on what he sees as the pros and cons of annual elections of directors?

Answer: Yes, we are committed to continuing it voluntarily.

7. After the Juukan Gorge disaster, Rio Tinto responded by appointing their first ever Indigenous director to the board in former WA State Labor Treasurer Ben Wyatt, who also joined the Woodside board. Congratulations on Indigenous employment reaching 7.2% in Australia and can the chair see the day when we too will have an Indigenous Australian sitting on the BHP board.

Answer: Yes, but no time frame provided.

8. What is the nature of our undertakings to the Australian government dating back to the Billiton merger in terms of board and CEO composition and location. How Australian do we have to be and once the DLC is collapsed, are we likely to return to having a majority of Australian based directors? What is the minimum amount of Australian based or Australian citizen directors that we could?

Answer: The CEO and CFO must reside in Australia but all this will be up for discussion with the government as part of the re-unification.

9. I've never understood why boards continue to resist opinion-based resolutions when these are standard in the US. What is so wrong about a group of shareholders putting up a resolution that expresses an opinion. It's a great way to gauge shareholder sentiment. You've been accommodating on certain climate issues so please be more accommodating on this question of opinion based resolutions by voluntarily accommodating them when the constitution gets reworked as part of the re-unification?

Answer: check transcript.