|Royal Dutch Shell||2017||N/A||https://www.blackrock.com/corporate/literature/publication/blk-vote-bulletin-shell-may-2017.pdf|
…the Investment Stewardship team has engaged extensively with Shell’s management and board on a range of governance topics, including the adaptation to a low carbon economy, having multiple meetings this year alone. These engagements afforded us the opportunity to discuss, among other matters, the company’s climate risk management practices. We found the company demonstrated a strong commitment to making continued improvements to its climate risk reporting and disclosure.
Shell has demonstrated a willingness to work collaboratively with shareholders on the issue of climate risk management and disclosure, which is at the center of our decision to vote with management…
At the 2015 Shell AGM, the board supported a shareholder proposal from the “Aiming for A” Coalition of investors. The resolution requested that Shell improve its annual reporting from 2016 onwards on the risks and opportunities associated with climate change. With the board’s support the proposal received 95.7% votes in favor.
Shell has publicly stated its support for the Paris Agreement and transition to a low carbon environment. Strategically, the company’s merger with BG Group in early 2016 enabled it to shift the balance of its production between oil and gas. The current integration efforts, which include an asset disposal program, will also transform the shape of the business. We are therefore mindful of the timing of this request and the impact that additional reporting could have on the company whilst this work is underway.
Shell has committed to report on steps taken to reduce its own GHG emissions and its role in the energy transition and we believe the company is making meaningful progress…
- Binding resolution on setting greenhouse gas (“GHG”) reduction targets
Based on the company’s commitment to climate risk disclosure (outlined in more detail below), conversations with the Board and Follow This, and our analysis of the effects of the proposal, led us to conclude that the proposal was overly prescriptive, difficult to implement and potentially damaging to the long-term value of our clients’ assets. We therefore voted with management and did not support the shareholder resolution at the 2017 AGM.