Shell urges shareholders to reject Dutch activist resolution

Shell has urged shareholders to reject calls that the oil giant adopt more stringent environmental targets.

The energy giant is targeting becoming a net-zero emissions business by 2050, a strategy that was backed by nearly 89% of investors when it was put before shareholders at last year’s annual general meeting.

Dutch activist group Follow This wants Shell to go further, however, and is calling on the company to "set and publish targets that are consistent with the goal of the Paris Climate Agreement: to limit global warming to well below 2C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5C".

The resolution also cites estimates by the International Energy Agency that net absolute emissions be reduced by 40% by 2030.

But ahead of May’s AGM, Shell has urged shareholders to reject the resolution, arguing that it was in the best interests of neither the company nor investors.

"Your directors believe that resolution 21, if adopted, could result in unrealistic interim targets that are harmful to the company’s energy transition strategy and against good governance," it said. "We believe that Shell’s energy transition strategy remains robust."

It continued: "It is unreasonable to require any single company to adopt 2030 targets that go further than even the most progressive pathways to net zero in its sector."

The firm concluded: "The company has set ambitious targets in line with the 1.5C goal of the Paris Agreement. Its strategy supports an orderly transition, one that maintains the supply of oil and gas where it is still need, and that accelerates the shift to low and zero carbon energy."