Shell PLC (LSE:SHEL, NYSE:SHEL) directors and major shareholders have been reminded that the board can be held liable as the company’s carbon emissions are on course to increase in violation of the climate court case verdict in The Hague a year ago.
A letter has been sent to the oil producer’s board by Friends of the Earth Netherlands, known as Milieudefensie, to remind them of their personal responsibility in not acting on the judge’s verdict.
The landmark court ruling called for Shell to reduce its CO2 emissions by 45% by 2030 compared to 2019 and start doing so immediately. The 45% reduction also includes 'scope 3' emissions, meaning those from burning Shell's gas and oil.
However, the company “knowingly and willfully has still not acted to execute the verdict”, Milieudefensie’s legal council said, which is leading to “liability risks for the company and the board”.
The letter was also sent to Shell's major shareholders, to inform them that the verdict “is not being implemented and the risks this entails for Shell, its shareholders and the board”.
The letter represents the first time board members have been called to account on such matters, the organisation said.
“The judge's verdict was clear and necessary: Shell must stop causing dangerous climate change, which threatens human lives and precious ecosystems" says Nine de Pater, campaigner at Friends of the Earth Netherlands.
“What Shell does or doesn't do is determined by the people in charge, that's why we’re looking at them. The board has to be aware that it is wilfully exposing Shell to potential damage claims that the company could never pay.”
He said it was clear that Shell's emissions “will not decrease enough with their current policy and may even increase. This is a conscious decision by Shell’s Board, even when there is such little time left to prevent runaway climate change. For this they can be held liable”.
Shell's business strategy shows that it plans to invest “much more” in polluting than in renewable energy, the organisation said.
"It's very simple: Shell has to produce and sell less oil and gas. Anyone who reads Shell's plans carefully will see that they don’t really intend to carry out the ruling, they are just pretending that they will," says Nine.
Shell is appealing the Hague decision, which is expected to take place in 2023 at the earliest.
"Rather than acting with the urgency required, Shell have put their efforts in to appealing the court verdict. Since last year, the evidence that they are causing climate change continues to mount against them. We therefore look forward to the Appeal with great confidence," says Nine.
Shell boss Ben van Beurden this year has described the decision by the court in the Hague as a “body blow” to the company, saying it was “deeply troubling” that a single business “should be held accountable for how the world produces and uses energy,” he said.