New legal advice - NAIF investment in Adani coal infrastructure likely illegal due to financial risks
12 April 2017
The company directors of the Northern Australia Infrastructure Facility (NAIF) are likely to be in breach of their duties if they approve a loan for a controversial coal railway in Queensland, according to legal advice received by Australian Conservation Foundation (ACF).
The advice by lawyers at Environmental Justice Australia (EJA) finds the NAIF directors would breach their duties to consider the financial risks associated with climate change if they make an investment decision in support of a Galilee Basin rail project.
EJA’s advice concludes that under the Public Governance, Performance and Accountability Act 2013 NAIF directors must consider financial risks from climate change and that the requisite standard of care and diligence prohibits investment in the proposed Adani and Aurizon rail projects.
“The Adani coal mine will fuel the global warming that is making the Reef sick, threaten 70,000 tourism jobs that rely on it, and divert urgent investment from renewable energy,” said ACF President Geoff Cousins.
“If NAIF Board directors burn $1 billion of public money on coal infrastructure that will help destroy the Reef and jobs, then absolutely they should be held to account.
“ACF will consider all avenues, including possible legal options, to halt the most destructive coal mine in Australian history and protect the Reef.
“NAIF must consider climate risks. These are assets that will be useless within a decade. Investment in coal infrastructure risks public money and in the meantime helps to drive dangerous global warming. NAIF directors who support it should be held accountable.”
EJA lawyer David Barnden said NAIF directors would expose Australian taxpayers – and themselves – to huge risks if they gave a loan to the proposed coal railway.
“Our analysis concludes NAIF directors will breach their duties if they support any rail project to cart coal from the Galilee Basin to the Great Barrier Reef coast,” Mr Barnden said.
“Recent legal developments mean NAIF support for Adani’s coal project – which is incompatible with keeping global warming below 2°C – would put the NAIF directors in conflict with their duties.”
The legal advice is available on request
Contact: Josh Meadows 0439 342 992