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Investors turn up heat on Shell over climate targets

Oil giant says its targets will limit its ability to adapt

People hold a protest as members of the board of the petrochemical company Shell hold their agm at the Circus theater in The Hague

Tue May 22 2018 - 14:29

Top investors in Royal Dutch Shell on Tuesday stepped up pressure on the oil and gas giant to commit to hard targets to reduce greenhouse gas emissions to battle climate change.

Shell has set out "ambitions" to halve carbon emissions by 2050 and expand in renewables energy, which chief executive officer Ben van Beurden said were ground breaking for the oil industry.

“Nobody else comes close, it is seriously ambitious,” van Beurden said of Shell’s plan at the company’s annual general meeting in The Hague.

While praising Shell for its plan, a growing number of major shareholders has urged the Anglo-Dutch company to commit to hard targets to reduce carbon emissions from its oil and gas production, as well as from fuels it sells around the world.

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“We call for this ambition to be translated into firm medium and short term targets, aligned with the Paris Agreement,” a group of 27 investors managing $7.9 trillion in assets said in a statement read at the agm.

Shell’s board has urged shareholders to vote against a resolution brought forward for a vote at the agm by activist group Follow This calling on Shell to set hard targets to reduce emissions in order to meet the 2015 Paris Climate Agreement goal to limit global warming to “well below” 2 degrees Celsius.

Van Beurden warned that doing so would hamper Shell’s efforts to adapt to the transition going on in energy.

Targets

“The reputation of our company is irrevocably linked to targets... Nobody can see how the energy transition will play out over this period,” van Beurden said.

The previous two climate resolutions tabled by Follow This in 2016 and 2017 won the support of 2.8 percent and 6.3 percent of the votes, respectively.

Last week, a group of 60 global investors urged companies to do more to reduce emissions and become more transparent about their plans.

Shell announced late last year an ambition to slash emissions of greenhouse gases by 20 per cent by 2035 and by half by 2050. The targets will include all of Shell’s operations as well as emissions from products consumed by consumers.

Producing and burning of oil and gas account for around 50 per cent of global carbon emissions. – Reuters

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