Activist Group Demands More Aggressive Emission Cuts From Big Oil

Follow This, an activist shareholder which has been calling for more aggressive emissions reductions for years, is increasing its pressure on Big Oil with resolutions calling for the biggest Western oil-producing companies to set targets to reduce absolute emissions by 2030.

Shareholder activists from Follow This have called on the top oil supermajors to set Scope 3 emission reduction targets by 2030 in a new set of shareholder resolutions filed with ExxonMobil, Chevron, BP, and Shell, the Financial Times reports.  

The shareholder resolutions, which FT has seen, are backed by asset managers with over $1.3 trillion in managed assets.  

While most major oil and gas firms have plans to cut Scope 1 and Scope 2 emissions, Scope 3 has been a more elusive target as those are the emissions generated from the burning of the products of the oil companies.

“There’s no single major with plans to reduce absolute emissions by 2030. And that’s what investors want,” Follow This founder Mark van Baal told FT. “We hope to get away from the smoke screens in all of this.”

Follow This has also criticized Big Oil for failing to invest the record profits it has made this year in a more aggressive expansion of renewable energy.

Commenting on Shell’s third-quarter earnings at the end of October, van Baal said, “The current windfall profits from high oil prices should be used to make the enormous investments in renewables that are needed to address the climate crisis and reduce dependency on oil and gas fields tied up in geo-political conflict.”

“We still don’t see Shell using this once in a lifetime opportunity to invest in diversification to ensure the long-term future of the company,” the founder of Follow This added.

After gaining a lot of traction in recent years, shareholder activism and the ESG push have run up against energy supply disruptions since the Russian invasion of Ukraine. For example, the world’s top asset manager, BlackRock, said it expected to support fewer shareholder proposals at the 2022 AGM season compared to 2021 as it finds that climate-related shareholder proposals have become unduly more prescriptive and micromanaging.

By Tsvetana Paraskova for Oilprice.com

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