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.