Shell secures backing for climate strategy but growing minority ...

Shell's Energy Transition Strategy, published earlier this year, outlined the group's plans to reach net-zero emissions by 2050. It aims to ... SkipNavigationMarketsBusinessInvestingTechPoliticsCNBCTVWatchlistCramerPROMenuKeyPointsShellsaidthatthecompany'sownresolutionreceived88.74%ofvotes.Theresult,whilenon-binding,waswidelyexpectedandostensiblyprovidesShellwithashareholdermandatetoproceedwithitsplanstoreachnet-zeroemissionsby2050.However,11%ofshareholdersvotedagainstShell'sownclimateplans.Thiscontrastedwith19otherresolutionsputforwardatShell'sonlineAGM,whereupto99%ofinvestorsfollowedmanagementadvice.What'smore,itisperhapsasharpincreaseinthenumberofshareholderschoosingtosupportaseparatemotionthatcouldbeacatalystforgreateraction.AShelltankertruckdeliversfueltoagasstation,operatedbyRoyalDutchShellPlc.,inRotterdam,Netherlands.JasperJuinen|Bloomberg|GettyImagesLONDON—RoyalDutchShell shareholdersonTuesdayoverwhelminglyvotedinfavoroftheoilgiant'senergytransitionplansatitsannualgeneralmeeting,thoughagrowingminoritydefiedrecommendationsandinsistedthecompanydomuchmoretotackletheclimateemergency.Shellsaidthatthecompany'sownresolutionreceived88.74%ofshareholdervotes.TheAnglo-Dutchoilmajor'sboardhadrequestedsupportforitsEnergyTransitionStrategy—avotethatwasthefirstofitskindintheenergysector.Theresult,whilenon-binding,waswidelyexpectedandostensibly providesShellwithashareholdermandatetoproceedwithitsplanstoreachnet-zeroemissionsby2050.However,11%ofshareholdersvotedagainstShell'sownclimateplans. This contrastedwith19otherresolutionsputforwardattheonlineAGM,whereupto99%ofinvestorsfollowedmanagementadvice.SecondclimateresolutionTobesure,U.K.corporategovernancecodestipulatesthatanyshareholdervoteabove20%requiresthecompanytogobacktoinvestorstodiscusstheirconcerns.What'smore,itisperhapsasharpincreaseinthenumberofshareholderschoosingtosupportaseparatemotiononTuesdaythatcouldbeacatalystforgreateraction.ShareholdersrejectedasecondclimateresolutionputforwardbyactivistinvestorFollowThisbyavoteof69.53%.TheDutchgroupputforwardthemotionurginginvestorstovotewiththemtocompelthecompanytobemuchmoreambitiouswithitsclimatepolicy.SpeakingtoCNBCaheadofthevote,FollowThisfounderMarkvanBaalhadsaidhewasconfidentalargerproportionofshareholderswouldbacktheirproposalatShell'sAGM.Thispredictionhasnowbeenprovencorrect,withmorethan30%ofinvestorsbackingtheirmotion—amarkedimprovementfromavoteof14.4%lastyear.In2016,just2.7%ofinvestorssupportedFollowThis'climatemotionatShell'sAGM."Thisyearforthefirsttime,Shellputforwarditsownclimateplanforavote—andyetagain,shareholdersaresendingastrongsignalthatShellwillhavetosetnewtargets.Shell'spolicyfallsshortofwhatisneededtoprotectinvestorsfromdevastatingclimatechange,"FollowThis'vanBaalsaidinastatementshortlyafterthevote.Headdedthecompanywouldnowhavetoreviseitstargetsonceagain.ImmensepressureShell'sAGMcomesatatimewhentheworld'slargestcorporateemittersareunderimmensepressuretosetshort,mediumandlong-termemissionstargetsthatareconsistentwiththeParisAgreement.Atpresent,nooilandgasmajorhasdisclosedhowitwillachieveitsgoalstobecomeanet-zeroenterpriseby2050orsooner,morethanfiveyearsaftertheParisAgreementwasratifiedbynearly200countries.Thelandmarkclimateaccordiswidelyrecognizedascriticallyimportanttoavoidanirreversibleclimatecrisis.Shell'sEnergyTransitionStrategy,publishedearlierthisyear,outlinedthegroup'splanstoreachnet-zeroemissionsby2050.Itaimstoreducenetcarbonemissionsbybetween6%to8%by2023whencomparedto2016levels.Thetargetjumpsupto20%by2030,45%by2035,and100%by2050.Thecompanyhassaiditwillpublishanupdatetoitsstrategyeverythreeyearsthroughto2050.Itwillalsoseekanadvisoryvoteonitsprogresstowarditsplansandtargetseveryyearfrom2022.ShellhasnotcommittedtoParis-alignedtargetsforabsoluteemissionsthroughto2030,anomissionthathasnotgoneunnoticedbyclimateactivistsandinvestors.Climatetechinvestmentissoaringthisyear—butmightnotbegoingtotherightareas,PwCsaysSamSheadElonMuskhasstrongviewsonhydrogen.NoteveryoneagreesAnmarFrangoulNissantoinvest$17.6billionovernextfiveyearstorampupelectricvehicleofferingAnmarFrangoulReadMore