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ClientEarth, the environmentalist group that tried to sue Shell’s board of directors, will ask the High Court at an oral hearing to reconsider its decision to dismiss a case the group brought against Shell’s board of directors.
The organization took Shell’s board to court in February on allegations that the company’s directors were guilty of mismanaging climate risk and of breaching company law with their failure to devise an emission-reduction strategy in accordance with the Paris Agreement targets.
“Shell may be making record profits now due to the turmoil of the global energy market, but the writing is on the wall for fossil fuels long term,” a senior lawyer for the environmentalist group said, as quoted by CNBC, in February.
The High Court, however, dismissed the case on the grounds that the plaintiffs “do not disclose a prima facie case for giving permission to continue the claim” and that its allegations imposed specific obligations on company directors on managing climate risk, ESG Clarity reported earlier this month.
The lawsuit send waves across the industry since it was the first of its kind—company executives and directors have never been targeted individually by environmentalist organizations before.
The High Court judge who ruled on the case noted that although ClientEarth had made some valid points with regard to the risk Shell faces as a result of climate change, the allegation that directors mismanaged this risk was hard to prove.
There is no “universally accepted methodology as to the means by which Shell might be able to achieved the targeted reductions [to emissions]…this means that it is very difficult to treat what is said as providing a proper evidential basis for alleging that no reasonable board of directors could properly conclude that the pathway to achievement is the one they have adopted,” Judge Trower said.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.