Oil giant Shell braces for shareholder revolt over climate plans
Shell faces an acrimonious annual general meeting, as climate advocates seek to increase pressure on the energy major. Dutch activist investor and campaign group Follow This has tabled a resolution that calls on Shell to align its climate targets with the Paris Agreement and commit to absolute carbon emissions cuts by 2030. This includes emissions generated by customers’ use of Shell’s oil and gas, known as Scope 3 emissions. The resolution is backed by Dutch pension managers MN and PGGM, which lead engagement with Shell on behalf of the world’s largest climate-focused investor group, Climate Action 100+. The Church of England Pensions Board and shareholder adviser PIRC have said they will vote against or recommend a vote against the re-appointment of Shell Chairman Andrew Mackenzie. This comes as investors increasingly see a warming planet as a risk to their portfolios.
FAQs:
What is the resolution that has been tabled at Shell’s annual general meeting?
The climate resolution 26 calls on Shell to align its climate targets with the Paris Agreement and commit to absolute carbon emissions cuts by 2030. This includes emissions generated by customers’ use of Shell’s oil and gas, known as Scope 3 emissions.
Who has backed the resolution?
Dutch pension managers MN and PGGM, which lead engagement with Shell on behalf of the world’s largest climate-focused investor group, Climate Action 100+, have endorsed the resolution. It is the first time these institutional investors have backed Follow This, a small Dutch activist investor and campaign group with stakes in several Big Oil companies.
Why are investors increasingly concerned about climate change?
Investors increasingly see a warming planet as a risk to their portfolios. The burning of fossil fuels, such as oil, gas, and coal, is the chief driver of the climate crisis. Climate change could have significant economic and social costs, such as loss of productivity, rising insurance costs, and health impacts.
What is Shell’s response to the resolution?
Shell, which is aiming to become a net-zero emissions business by 2050, has recommended shareholders vote against the motion tabled by Follow This. The company describes Climate Resolution 26 as “unclear, generic, and would create confusion as to Board and shareholder accountabilities.” Proxy advisors Glass Lewis and ISS have both recommended their clients vote against Resolution 26.
Shell prepares for shareholder uprising due to climate strategy
Shell’s annual general meeting looks set to be a tense affair as climate-focused investors push the company to align its climate targets with the Paris Agreement. Follow This, a Dutch activist investor and campaign group with stakes in several big oil companies, has tabled a resolution calling on Shell to commit to absolute carbon emissions cuts by 2030, including emissions generated by customer use of its oil and gas. It echoes a 2021 ruling by a Dutch court that Shell should reduce its global carbon emissions by 45% by the end of the decade, which the company has appealed. For the first time, institutional investors MN and PGGM, both Shell shareholders, have endorsed the resolution. It comes as investors increasingly see a warming planet as a growing risk to their portfolios, with burning fossil fuels as the chief driver of the climate crisis. However, Shell, which is aiming to become a net-zero emissions business by 2050, has recommended that shareholders vote against the motion.