A prominent activist group has filed shareholder resolutions calling on four of the biggest western energy companies to cut emissions more aggressively this decade in an effort to revive investor pressure on Big Oil over climate goals. In motions submitted to BP, Shell, ExxonMobil and Chevron, Dutch shareholder activist Follow This called on the companies to set clear targets to reduce their scope 3 emissions by 2030, in order to be “consistent” with the goals of the Paris Climate Accords to limit global warming.
The group said the motions, seen by the Financial Times and set to be unveiled on Monday, had been co-sponsored by investors with more than $1.3tn in assets under management. Scope 3 emissions, which is the carbon produced when a product that a company sells is burned, account for 80 to 90 per cent of the total carbon emissions from oil and gas groups, according to consultants Wood Mackenzie. “
There’s no single major with plans to reduce absolute emissions by 2030
There’s no single major with plans to reduce absolute emissions by 2030. And that’s what investors want,” said Mark van Baal, founder of Follow This. “We hope to get away from the smoke screens in all of this.”
Support for climate motions at oil producers has gained traction in recent years but slipped this year after major investors said they were becoming too prescriptive. Overall support for environmental and social motions fell from 36 to 27 per cent in 2022, according to ISS data analysed by asset manager BlackRock, which cut its own support in half.
The last Follow This resolution, which also called for more aggressive climate targets, won support from just over 20 per cent of shareholders at Shell in May, down from 30 per cent the year before, and only 15 per cent of shareholders at BP, down from 21 per cent a year earlier. “We think we can regain momentum and we have to,” said van Baal.
“I think investors should realise — and they are realising now — that if we don’t regain momentum it is another year lost.” Shell criticised the latest Follow This proposals, stating that there was no standard methodology to determine compliance with the Paris Agreement and insisting the pact’s targets were already aligned with its goals.
“Follow This has consistently proposed shareholder resolutions that are simplistic, unrealistic and against the best interests of Shell,” it said.