Adani coal mine contract a 'mistake', Siemens CEO says

Decision to continue with a $30m rail signalling project for a coal mine in Australia has drawn the ire of climate activists

Abu Dhabi, United Arab Emirates - Joe Kaeser, CEO of the Siemens group at Abu Dhabi Sustainability Week taking place at ADNEC. Khushnum Bhandari for The National
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Siemens' involvement in an Australian coal mining project involving India's Adani Group was a "mistake", but the company needs to complete the work to fulfil its contractual obligations, its chief executive Joe Kaeser said.

The German industrial firm has come under fire from climate activists for its $30 million (Dh110m) rail signalling contract at Adani's Carmichael mine in Australia, where raging bush fires over the past two months have killed half a billion animals and scorched millions of hectares of land.

"It was a mistake to do that. We needed to look into our financial and fiduciary duty. If it was my company and I owned it 100 per cent, I probably would have decided differently," Mr Kaeser told The National in an interview in Abu Dhabi.

"But I'm only a manager who acts on behalf of the shareholders, so it was a big conflict that we had to manage and the outcome was we will fulfill our obligation," he added.

Siemens announced the establishment of a sustainability board to review and assess future projects based on their environmental credentials following the uproar over the company's involvement in the Adani project.

Climate activists in Germany have remained largely unimpressed by Mr Kaeser's appeasement. The country's most prominent climate change activist Luisa Nuebauer of the Fridays for Future movement rejected Mr Kaeser's offer of a seat on the company's sustainability board, a decision the chief executive said he "respected".

"The media said I invited her to the supervisory board. This is not true, I invited her to the boards or institutions where she can bring the legitimate topic of the young generation to the table," he said.

"Protesting is important but it doesn't solve anything. We need solutions. We must not divide the young and the old, we must not divide the old economy and the new economy, we must not divide the industrial economies and the developing economies. We need to bring them together," he added.

The sustainability board will look into whether projects the company is interested in would be "feasible and worthwhile" to progress.

"I want to have a debate about environmental matters and projects before we sign the contract and not after we sign the contract and not after the fact that we can't do much about it," said Mr Kaeser.

The Siemens chief wrote an article on professional networking website LinkedIn in October about sharing ideals with environmental activists on climate protection. He called rising sea levels, melting glaciers and ice sheets symptoms of a disease that needed a cure through a "sustainable, peaceful and inclusive" environmental policy.

"We want people to participate like environmentalists.... and we would love to have the youth on the table and we need to be more mindful in the beginning but now I have no choice. I regret that I need to tell people that we need to go ahead but I had actually no choice," said Mr Kaeser.