Lawyers who focus on environmental cases have joined forces with a number of Shell shareholders to take legal action against the Shell board, holding the members personally responsible for their failure to deal with climate risks and for not adopting a strategy in line with the 2015 Paris climate agreement.

‘We’re arguing that the plan Shell’s board currently has for making that shift is simply unreasonable,’ the ClientEarth foundation says on its website.

‘It fails to deliver the reduction in emissions that is needed to keep global climate goals within reach and continues with fossil fuel production for decades to come. This will tie the company to projects and investments that are likely to become unprofitable as the world cleans up its energy systems.’

The case, which will be heard at the High Court in Britain as Shell is now a 100% British company on paper, is supported by several international investors, including British pension fund Nest, Swedish pension fund AP3, and a French and Danish asset manager.

In total the investors control some 12 million Shell shares, or 0.2% of the total.

Earnings

Earlier this month, Shell said it had booked record profit of almost €38.5 billion last year, boosted by high oil and gas prices following Russia’s invasion of Ukraine. The total – $40 billion – is almost double 2021’s earnings and the highest in the company’s 115 year history.

Dutch case

Last April, Dutch environmental campaign group Milieudefensie wrote to the members of the board at Shell warning them they could be held liable for failing to take action to reduce greenhouse gas emissions despite being ordered by judges to do so in 2021.

In May 2021, a court in The Hague said that Shell must play its part in the fight against dangerous climate change and ‘reduce the carbon dioxide emitted by the Shell group and its customers by 45% net by the end of 2030, compared with the level in 2019.’

Shell, which is appealing against the ruling, said at the time it cannot be held liable in the Netherlands for events that take place worldwide. ‘The scene of the crime, in this case, is the location where the emissions take place,’ a Shell lawyer told the court during the 2021 hearings.