Coal plays a critical role as an energy pillar in many parts of the world. In three of the world’s most populous countries – China, India and Indonesia – coal supplies more than 60% of electricity needs. However, coal is also one of the most polluting and greenhouse gas emission-intensive substances, holding the dubious title of the single largest contributor to global warming.
Mining is one of the industries under scrutiny for its role in the coal supply chain. Amid growing negative public sentiment and investor pressure, the mining majors are pursuing different strategies regarding coal. Rio Tinto completely exited in 2018. Anglo American spun out its coal assets into a separate company, effectively putting the decision in shareholders’ hands. Meanwhile, Glencore held on to coal, declaring “managed decline” the most responsible approach. The case’s dilemma – “who has it right” – offers fertile ground for debate. Participants should analyze the pros and cons of the company’s strategies from different angles and explore the repercussions on various stakeholders, on shareholders and on the environment. The potential learnings from this case and previews of the difficult trade-offs leaders face extend beyond mining to many industries in transition.