Shell urges shareholders to reject activist’s climate resolution

SHELL'S board told shareholders to reject a Dutch activist group’s resolution that asks the energy company to set more stringent climate goals. 

It said that adopting the Follow This vote, which wants the company’s policies to be more consistent with the Paris climate accord, “could result in unrealistic interim targets that are harmful” to its own energy transition strategy and good governance.

To convince investors that its already doing enough, Shell will put its energy transition progress report to a non-binding vote at the annual shareholder meeting scheduled for May 24.

The company won the backing of 89 per cent of investors when it put the green plan to the ballot for the first time last year. Shell said at the time that it would publish an updated strategy every three years, and seek an advisory vote on its progress every year.

At the same time, Follow This climate proposal that’s similar to the one filed this year received 30 per cent votes in favour, the most it has ever garnered since it began filing with Shell in 2016.

Climate conscious investors and groups enjoyed one of their most successful years ever in 2021. Shareholders voted for reducing emissions at Chevron Corp while a small hedge fund managed to appoint new members to Exxon Mobil Corp’s board. Besides Shell, Follow This resolutions filed with BP and Equinor received more support than ever before.

Shell says it’s making strong progress toward net-zero carbon by 2050, with “critical investment decisions” in solar energy, wind and hydrogen. The company cut absolute emissions from its operations and the energy it uses to run them by 18 per cent last year from 2016 levels and aims to halve them by the end of this decade.

Progress on the key Scope 3 emissions -- which make up the bulk of its greenhouse gases and are associated with the end-use of its products -- were little changed last year.

The company’s AGM will be held in London for the first time since the unification of Royal Dutch Petroleum and Shell Transport & Trading in 2005. Since then, shareholders had been assembling in The Hague where Shell was based, before it shifted its headquarters to London.  BLOOMBERG