Twenty-seven major shareholders, including a number of European pension schemes, have co-filed a climate resolution with FollowThis, calling on Shell to align its medium-term emissions reduction targets with the Paris Climate Agreement.

The investors, which collectively represent €3.9trn in assets under management and own around 5 per cent of Shell's stock, include Amundi, Sweden's AP3 and AP4, Scottish Widows, the UK's government backed pension scheme, Nest, and the UK's Pension Protection Fund (PPF).

FollowThis also previously filed a similar shareholder resolution urging Shell to align its carbon reduction targets with the Paris Climate Agreement in 2023, which was backed by 20 per cent of shareholders in 2023.

However, the updated resolution includes two key differences to the 2023 wording, replacing the 2030 target with "medium-term targets", and completely rewriting the supporting statement to reflect investor requests for a more agnostic text that is solely focused on emissions.

Follow This founder, Mark van Baal, highlighted the latest shareholder resolution as an "extraordinary step", demonstrating how dedicated the investors involved are to tackling the climate crisis at its source.

He continued: "This escalation of 27 leading investors puts the call for emissions reductions by energy companies front and center for all institutional investors.

“We expect votes to increase as more investors follow their leading peers by voting for change at Shell, which is the bare minimum they can do.

“Large shareholders hold the key to tackling the climate crisis with their votes at shareholders’ meetings. Shell will only change if more shareholders vote for change. The resolution is designed to give Shell a shareholder mandate to drive the energy transition.”

Adding to this, a spokesperson for the Fourth Swedish National Pension Fund, AP4, said: “We are realizing the need for fossil fuel in the short-term horizon and we support the idea of integrated energy companies transitioning their business models.”

Nest head of responsible investment, Diandra Soobiah, added: "We urge Shell to set a credible scope 3 absolute emissions target. This would demonstrate leadership, show Shell is serious about transitioning its business, and play a role in generating real-world change.”

Commenting in response, a Shell spokesperson said: “We remain committed to constructive engagement with our shareholders, and we believe our climate targets are aligned with the more ambitious goal of the Paris Agreement.

"In early 2024, we will publish our first Energy Transition Strategy update, on which there will be an advisory vote at our 2024 AGM.

“The 2024 resolution from FollowThis is broadly unchanged from their 2023 submission, which was rejected by shareholders (as its variations have been every year since first being submitted in 2016).

"Shell’s Board has previously advised shareholders that the FollowThis resolution was unrealistic and simplistic, that it would have no impact on mitigating climate change, have negative consequences for our customers, and was against the interests of the company and our shareholders.

“Continued, targeted investment in oil and gas will remain necessary to meet global energy demand over the coming decades as the world transitions to a lower carbon future.

“By the end of 2022, the net carbon intensity (NCI) of the energy products sold by Shell – a metric that measures emissions per unit of energy sold (grams of CO₂ equivalent per megajoule) – had fallen by 3.8 per cent, compared with 2016.

"The majority of this decrease was achieved through emissions avoidance and reduction activities. Our analysis, using data from the International Energy Agency, shows the net carbon intensity of the global energy system fell by around 2 per cent over that same time.”

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