Shell suffers investor revolt over gas production impact on climate plans
The oil major saw 20.56% of votes supporting a resolution put forward by shareholders at its annual general meeting (AGM) held near Heathrow Airport on Tuesday.
The proposal called for the board to disclose whether and how its liquified natural gas (LNG) demand forecast, production and sales targets are consistent with its climate targets.
While not legally binding, support for shareholder resolutions can put pressure on business leaders to respond to the matters raised, and more than 20% of dissent against the board can be considered a rebellion.
Previous shareholder resolutions focused on climate received similar levels of support over the last five years, ranging from 18.6% to 30.5%.
Responding to the results, Shell said the board will meet its obligation to explain what actions it will take to consult with shareholders to understand the reasons why just over a fifth supported the resolution.
In his opening address, chair Sir Andrew Mackenzie defended Shell's recent shift of focus back towards fossil fuels.
'Shell believes the world needs more liquified natural gas to replace coal in Asia for energy security, and to complement and enable renewables,' he said.
'So we expect LNG will play a critical role in the transition.'
Sir Andrew also argued that Shell expects all demand to stay strong for the 'foreseeable future', meaning continued investment in fossil fuels will be needed.
'Let's be clear, no business can operate outside the rules of supply and demand.
'So for the energy transition to succeed, there must also be demand for low carbon options from customers who are willing and able to pay for it.'
During the nearly three-hour meeting, the board was repeatedly challenged about its impact on the planet and commitment to cutting emissions to zero overall by 2050 – known as net zero.
Asked whether Shell would meet the demands of the shareholder resolution, chief executive Wael Sawan said: 'There is not a company that discloses more or better information on LNG than Shell.'
Mr Sawan then made a plea to shareholders not to support 'these sorts of resolutions'.
'What they are undermining is the ability of the board that you have elected to be able to drive the strategy of the company to do their job,' he said. 'Challenging and providing input is very welcome but let's have those engagements and not do it through the resolutions.'
The resolution was co-filed by Brunel Pension Partnership, Greater Manchester Pension Fund, Merseyside Pension Fund and the Australasian Centre for Corporate Responsibility (ACCR) with the support of activist group ShareAction and more than 100 individual investors.
Responding to the voting results, Jackie Garton, senior corporate climate campaign manager at ShareAction, said: 'Today's vote sends a strong message that shareholders will not sit back as Shell doubles down on growing its liquified natural gas production despite its own stated climate commitments.
'It's worrying that instead of addressing their concerns, Shell repeatedly shifted the blame for their oil and gas production growth plans onto consumers during its annual general meeting.'
Mark van Baal, from activist group Follow This, which did not file its usual climate resolution this year, said: 'Today's AGM demonstrates that more and more shareholders do not accept that the board puts the future of the company at risk by stubbornly sticking to a century old business model that risks being disrupted within five years.'
In a statement, Mr Sawan said: 'Shell's shareholders have strongly backed our strategy to deliver more value with less emissions as outlined at Shell's Capital Markets Day 2025.
'Our focus on performance, discipline and simplification enables us to invest in providing the energy the world needs today, and in helping to build the low-carbon energy system of the future.'
As the meeting was taking place at a hotel near Heathrow, protesters believed they were unable to stage an action outside because of a High Court injunction prohibiting environmental demonstrations at the airport.
Activists from campaign groups Amnesty International UK, Fossil Free London, and the Justice 4 Nigeria coalition instead held a protest outside Shell's global headquarters in central London.
Sacha Deshmukh, chief executive of Amnesty International UK, called the effect of such injunctions in protecting firms such as Shell from protests as 'chilling'.
Areeba Hamid, co-executive director of Greenpeace UK, which supported the protest, accused the firm of 'hiding' behind the injunction to 'shut down legitimate questions about its operations'.
A spokesperson for Shell denied that the location had been chosen due to the injunction and that it chose the location 'purely based on availability'.
In a statement on its website, Heathrow Airport also said: 'For the avoidance of doubt, Heathrow Airport Limited does not consider that the terms of the injunction have the effect of prohibiting or restricting the lawful attendance of any shareholder at the Shell AGM.'
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