Big oil rocked by climate backlash: Triple whammy as Shell, Exxon and Chevron face growing anger over fossil fuels
Big oil has come under fire from the courts and investors as pressure mounts on them to go green.
In a major win for campaigners including Friends of the Earth, Shell lost a landmark court case in Holland when a judge ordered it to ramp up its plans to cut greenhouse gas emissions.
Revolution was also in the air in the US, where corporate titan Exxon Mobil’s shareholders backed activists in their bid to reshape the company.
In a major win for campaigners including Friends of the Earth, Shell lost a court case in Holland when a judge ordered the company to ramp up plans to cut greenhouse gas emissions
Rival oil giant Chevron also faced a rebellion at its annual general meeting over climate change.
Danni Hewson, financial analyst at AJ Bell, said: ‘Climate activists have power and they’ve figured out how to use it.
‘Change can be painful but it is coming. Reaching the ambitious climate targets western governments have set requires big oil to be at the forefront of that change.’
With the oil industry in particular under pressure to clean up its act, Shell had set out plans to reduce emissions by 20 per cent within a decade and reach net zero by 2050.
But Milieudefensie, the Dutch wing of Friends of the Earth, called on the company to go faster, cutting carbon emissions by 45 per cent by 2030.
A lawsuit was filed in April 2019 on behalf of more than 17,000 Dutch citizens who claimed Shell was threatening human rights by investing billions in the production of fossil fuels.
The case was heard in The Hague, where Shell’s headquarters are based. Yesterday, Judge Larisa Alwin backed the campaigners, and said that by 2030 Shell’s net carbon emissions must be 45 per cent lower than 2019 levels.
The decision stunned investors, and Shell said it would appeal.
The judgement means Shell will have to ramp up current climate policies radically to hit the target and it is expected to sell more assets and cut back exploration.
Alwin said her decision would require ‘a change of policy’ from Shell that could ‘curb the potential growth of the Shell group’.
The ruling shows how strong climate change activists have become and oil majors can no longer brush them aside. Donald Pols, director of Friends of the Earth Netherlands, said it was ‘a monumental victory.’
While many countries have signed up to the Paris Agreement on climate change, companies are not part of the agreement and are not bound by national pledges.
The ruling could set a precedent and make oilers’ climate change emissions plans legally binding.
Hours later, activist hedge fund Engine No.1 won a big victory over Exxon Mobil at the company’s annual general meeting.
Shareholders elected two of Engine’s four nominated directors to the board. Engine is trying to reshape the oiler to make it ramp up plans to combat climate change. Second-largest shareholder Blackrock was among those to back Engine nominees.
Separately, Chevron executives were clobbered as 61 per cent of investors voted for a proposal to reduce emissions from its customers.
US oil giants have been slow to change and while European oil companies have been selling off oil fields and cutting back on exploration, Exxon and Chevron have doubled down on oil.
But US President Joe Biden has said that this is the ‘decisive decade’ for climate change, and the US has pledged to cut carbon emissions by 50 to 52 per cent below 2005 levels by the year 2030.