Shell chief vows to bolster emissions strategy after court ruling

14 Jul 2021
Royal Dutch Shell has vowed to accelerate its strategy towards becoming a net zero emissions business, two weeks after a Dutch court ruling ordered the company to cut its global carbon emissions by 45% by the end of 2030 compared with 2019 levels.

Shell’s chief executive, Ben van Beurden, promised to “rise to the challenge” in helping to create a low-carbon energy system, but came out fighting for the Anglo-Dutch oil company he runs, insisting it has been leading the industry in taking responsibility for its carbon emissions.


In a statement on his LinkedIn page, Van Beurden said he was surprised by the court’s verdict and was “disappointed that Shell is being singled out by a ruling that I believe does not help reduce global CO2 emissions”.

He added: “A court ordering one energy company to reduce its emissions – and the emissions of its customers – is not the answer.”

The transition to low-carbon energy, which remained necessary to battle the climate emergency, was “far too big a challenge for one company to tackle”, he wrote, calling for clearer regulations and policies from global governments.

Shell said it was reviewing the ruling handed down last month by a court in The Hague and expected to appeal. But the court has said its decision is immediately applicable and should not be suspended before an appeal.

Shell’s oil production had probably peaked in 2019, Van Beurden said, adding that he believed the firm’s total absolute carbon emissions would decline from 2018 levels. Instead, he said Shell should work with its customers to help them find their own way to achieving net zero emissions.

The oil firm said it would continue to produce oil and gas products “for a long time to come” in order to meet customer demand and retain the company’s financial strength, while also attracting investment.

“Imagine Shell decided to stop selling petrol and diesel today. This would certainly cut Shell’s carbon emissions. But it would not help the world one bit,” Van Beurden wrote. “Demand for fuel would not change. People would fill up their cars and delivery trucks at other service stations.”

The company said it had “rigorous, short-term reduction targets” on the way to its goal of becoming a net zero emissions business by 2050. The chief executive added that Shell had taken responsibility for reducing the carbon emissions it produced, as well as those produced when customers used its products.

The landmark Dutch case was brought by the environmental group Friends of the Earth and more than 17,000 co-plaintiffs, who successfully argued that Shell had been aware of the dangerous consequences of CO2 emissions for decades, and that and its targets remained insufficiently robust.

The company was told by the court that its emission reductions, along with those of its suppliers and buyers, should be brought into line with the Paris climate agreement.

Although it intended to appeal against the ruling, Shell said it would “seek ways to reduce emissions even further in a way that remains purposeful and profitable”.

As part of its energy transition strategy, Shell said it had in recent years invested “billions of dollars” in lower-carbon energy, including wind and solar power, hydrogen and biofuels.

Shell has vowed to give investors a chance to vote on the progress of its transition strategy at every annual shareholder meeting. Van Beurden complained that the court hearing took place several months before the publication of the strategy.

Shell faced a significant investor rebellion at its most recent AGM, when a shareholder resolution coordinated by Follow This, a Dutch climate activist group, calling for the company to set binding carbon emissions targets received 30% of votes.

Mark van Baal, the founder of Follow This, said Van Beurden had “failed to have his epiphany moment, and still thinks that committing to the Paris agreement is an unfair ask. More stakeholders than ever are pushing for Paris-alignment and there comes a time when Shell will have to listen and act. Butvan Beurden can take comfort that Shell is not alone in this challenge.”

Rachel Kennerley, an international climate campaigner at Friends of the Earth, said Shell’s promises did not far enough.

She added: “If Mr van Beurden was as serious about this as he claims, he’d stop dismissing his company’s role in driving this devastating situation and would use the court ruling as an intervention to do the right thing, rather than appealing it with all of Shell’s corporate might.”

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