*ClientEarth, an environmental law firm, is filing the first lawsuit ever against 11 members of Shell’s Board at London’s High Court, in the UK, for their alleged failure to approve an energy transition strategy that aligns with the Paris Agreement, amounting to ‘a breach of a Director’s legal duties’

*We do not accept the firm’s allegations against Board members -Shell Spokesperson

Isola Moses | ConsumerConnect

Shell faces a new front in climate litigation as lawyers, supported by a group of shareholders of the international oil company (IOC), sue the oil giant’s Board of Directors in the United Kingdom (UK).

ConsumerConnect reports a court in The Hague, Netherlands, in 2021, had ordered Shell Oil Company  to slash its greenhouse gas emissions 45 percent by 2030, compared with 2019 levels.

However, the oil and gas company is reportedly appealing the ruling.

It was learnt ClientEarth is filing the very first lawsuit of its kind anywhere in the world against 11 members of the multinational company’s Board.

Two years after a Dutch court had ordered Shell to slash its emissions, ClientEarth, an environmental law firm, is filing the unprecedented lawsuit against the members of the Board, accusing them of failing to manage the company’s climate risks.

The environmental law firm is bringing the suit under the UK’s Company Act against Shell’s Board at London’s High Court, arguing that their failure to approve an energy transition strategy that aligns with the Paris Agreement amounts to a breach of a Director’s legal duties.

Paul Benson, a senior lawyer at ClientEarth, stated: “The Board is persisting with a transition strategy that is fundamentally flawed, leaving the company seriously exposed to the risks that climate change poses to Shell’s future success – despite the Board’s legal duty to manage those risks.”

It is recalled the Paris Agreement was adopted 2015 with a goal of slowing global warming to well below 2C, compared to pre-industrial levels.

With record temperatures across much of the planet 2022, and a series of catastrophic weather events, the severe effects of climate change are already being felt, agency report said.

Shell reacts to allegations of leadership irresponsibility

In response to the latest lawsuit against the Board of the IOC, a Shell Spokesperson said: “We do not accept ClientEarth’s allegations.

“Our Directors have complied with their legal duties and have, at all times, acted in the best interests of the company.”

Trying to hold Board members legally accountable for their companies’ contributions to climate change marks a fresh strategy as lawyers and campaigners increasingly turn to the courts to try and pin some of the blame for the climate crisis on Big Oil, report stated.

It s also noted that in the Netherlands at least, activists have had success.

The company further stated that “Shell’s goal is to become a net zero emissions energy company by 2050.

“Appealing does not change this.”

It noted Shell already has plans to halve emissions from its own business and the energy it purchases, by 2030 compared with 2016 levels.

But those represent less than 10 percent of its overall carbon footprint, with most planet-warming gases emitted when its customers burn the fuel they buy from Shell.

While the company also has a goal of reaching net zero emissions across all its business by 2050, there’s not yet a clear plan how to do it, according to report.

It was the oil and gas business that drove record-breaking profits of nearly $40billion (€37.1billion) in 2022.

Whereas Shell’s investment in its renewables unit hit an all-time high in 2022, report indicates it was less than half what the company spent on its business exploring for and extracting fossil fuels.

Our plans to grow company’s natural gas business  -Shell CEO

Wael Sawan, who took over as Shell’s Chief Executive Officer (CEO) January 2023, has said he plans to grow the company’s natural gas business while Shell pauses growth in spending on its renewables unit.

The current lawsuit, which also alleges the Directors failed to comply with the Hague ruling, is being supported by institutional investors, including pension-fund manager London LGPS CIV, Nest, Swedish pension fund AP3, and Danske Bank Asset Management. Together they hold over 12 million shares in the company, still less than 0.2 percent of the total, according to report.