Two major British pension funds are threatening to vote against appointing directors of oil and gas groups Shell and BP if they don’t tighten their climate targets. This was stated in the British business newspaper The Financial Times by the directors of the British university pension fund USS and the pension fund for British local authorities Borders to Coast. The two funds jointly manage £130bn, the equivalent of around €147bn, of pension assets.
By voting against the appointment and reappointment of directors, the two pension funds want to force oil and gas companies to align their businesses more quickly with the Paris climate goals. They believe that a “personal approach” is best understood by directors and call such a dissenting voice “one of the most compelling ways investors can influence policy.”
No CO2 emissions
Both Shell and BP have set a goal of net zero CO2 emissions by 2050. But they rely heavily on techniques that have yet to be further developed, such as CO2 capture and storage. Companies are then criticized for not being green enough, and activist shareholders like Follow This and increasingly pension funds have been trying to accelerate greening through shareholder resolutions for years.
But after record profits both companies recently announced for 2022, BP said it would phase out oil and gas extraction through 2030 less quickly than previously expected. Shell’s new CEO, Wael Sawan, said his company could keep pumping more oil for longer.
Reconfirm
Both pension funds are therefore willing to vote against the reappointment of supervisory directors Andrew Mackenzie of Shell and Helge Lund of BP. The USS university pension fund, one of the UK’s largest with £91bn of assets under management, is also wanting to vote against if companies fail to provide a specific breakdown of investments in projects that boost carbon emissions.
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
