In an open letter to the Financial Times, a group of 60 large investors urged oil and gas companies to ramp up their climate change strategies and their efforts to reduce emissions.
"For the Paris climate agreement to succeed, the oil and gas industry must be more transparent and take responsibility for all its emissions. As long-term investors, representing more than $10.4 [trillion] in assets, the case for action on climate change is clear," said the letter, which was signed by Aberdeen Standard Investments and BNP Paribas Asset Management, among others.
The letter was published in advance of Royal Dutch Shell PLC's annual general meeting May 22, at which time shareholders are expected to vote on a resolution that would require the company to set more stringent emissions reduction targets.
In mid-April, Shell's board of directors urged investors to vote against the resolution, which was filed in November 2017 by Follow This, a Netherlands-based group of green shareholders in Shell. The resolution would prompt Shell to set and publish more aggressive targets that are aligned with the goal of the Paris Agreement on climate change to limit global warming to below 2 degrees C.
"Regardless of the result at the Shell [annual general meeting], we strongly encourage all companies in this sector to clarify how they see their future in a low-carbon world. This should involve making concrete commitments to substantially reduce carbon emissions, assessing the impact of emissions from the use of their products and explaining how the investments they make are compatible with a pathway towards the Paris goal," the letter said.
Previously addressing investor concerns regarding its climate change strategy, Shell reiterated in early April that despite an increase in its emissions in 2017, it intends to reduce the carbon footprint of the energy products it sells by 50% by 2050, with plans to reassess its progress every five years.