Energy giant Shell PLC (LSE:SHEL, NYSE:SHEL) could face a renewed court battle with ClientEarth, an environmental charity turned activist investor of the energy giant.
ClientEarth revealed it would be challenging a court decision to dismiss a lawsuit against the oil titan's board for not dealing with climate risks effectively.
The environmental charity is hoping to be granted an oral hearing with the High Court to persuade it to reconsider the case.
The lawsuit, which ClientEarth said is the first of its kind, aims to place responsibility on the Shell board of directors for failing to prepare for its shift from fossil fuels to sustainable energy.
“This claim is about Shell's board adopting a strategy that is fit to manage the serious and significant climate risks facing the company – in line with its legal duties,” said Paul Benson, a senior lawyer for ClientEarth.
If judges were to consider the environmental group’s argument it could allow for more investors to raise similar issues with other companies over climate-related risks, lawyers argued.
Shell countered stating that the board of directors have to compete with multiple targets when managing the complex business and that the claim was “utterly misconceived”.
"We remain confident that permission to bring the claim should not be granted and that the court will stand by its ruling," a spokesperson for the energy giant said.
Last week, a High Court judge said that as of last year, 80% of Shell investors were in favour of its energy transition strategy.
A group of European institutional Shell investors have written in support of the case ahead of the energy firm’s annual general meeting next Tuesday.