The board of energy giant Shell has recommended to shareholders that they accede to demands from a group of pension funds to take action on climate change.
Last month, a group of 150 investors, including Local Government Pension Scheme (LGPS) funds, known as ‘Aiming for A’, filed a shareholder resolution calling on Shell to improve its reporting on, and commitment to, activity designed to reduce climate change risk.
JJ Traynor, executive vice president of investor relations on the Shell board, has now written to shareholders informing them that the board supports the resolution.
The letter said: “The board has given consideration to the resolution and has decided to recommend that shareholders support the resolution at the annual general meeting.
“Shell will provide additional reporting in 2015, in advance of full reporting in response to the resolution in 2016, in the most appropriately updated report or website location which will include our sustainability reporting and our emissions reporting website.”
The group of investors filed a similar resolution with BP last month but there has been no response to this yet.
The Environment Agency Pension Fund, West Yorkshire Pension Fund, South Yorkshire Pensions Authority, and the Greater Manchester Pension Fund are all within the group.
Cllr Kieran Quinn, chair of the Greater Manchester Pension fund and of the Local Authority Pension Fund Forum (LAPFF), said: “This development from Shell is a clear example of the effectiveness of shareholder engagement backed by investor commitment. Universal owners taking an active approach to long-term risk, sustainability and carbon management issues has benefits both for our beneficiaries and for our underlying investments.”