Shell shareholders reject emissions target proposal

FILE PHOTO: A logo of Royal Dutch Shell is seen at Gastech, the world’s biggest expo for the gas industry, in Chiba, Japan, April 4, 2017. REUTERS/Toru Hanai/File Photo

By Karolin Schaps

THE HAGUE (Reuters) – Royal Dutch Shell shareholders on Tuesday widely rejected a proposal by an environmental group calling for the oil company to set and publish annual targets to reduce carbon emissions.

The vote is a setback for climate activists who are increasing pressure on global oil companies, including U.S. firms Exxon Mobil and Chevron, to become more ambitious in helping combat climate change.

As many as 94 percent of Shell shareholders who cast a vote decided against the resolution, according to preliminary results displayed during the company’s annual general meeting (AGM) in The Hague.

There were also a number of abstentions, a Shell spokesman said, without disclosing numbers.

“The resolution is an unreasonable ask,” said Shell Chief Executive Ben van Beurden, promising to engage further with investors on how the oil company can become more transparent about its plans to tackle climate change.

Shell said binding emissions reduction targets would mean “tying its hands” and weakening the company because it would be forced to reduce production and sales.

Growing investor sensitivity to climate change risks have already led Shell to link a percentage of its bonus payments to managing greenhouse gas emissions and investing in renewable energy projects such as offshore wind farms.

Van Beurden’s speech at Tuesday’s AGM began with a 30 minute presentation of the Shell’s initiatives to help lower carbon emissions.

Mark van Baal, founder of the Follow This activist group which put forward the resolution, said the group would target other oil companies such as BP as soon as funding was available.

There was also little opposition to a 60 percent increase in van Beurden’s pay package, with 93 percent of shareholders supporting it in Tuesday’s vote.

Last week, shareholders of rival London-listed oil company BP approved CEO Bob Dudley’s pay package, which was 40 percent lower than the previous year.

Last year, some 60 percent of shareholders voted against Dudley’s pay package of nearly $20 million (£15.4 million).

(Editing by David Clarke)

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