LONDON (REUTERS). Environmental lawyers ClientEarth stated on Tuesday, March 15, that they were planning to sue Shell’s directors for their climate transition plan. It was the first such case of its type.
ClientEarth lawyers claimed that they intend to hold the directors personally responsible for their failure to prepare for the global transition to a low carbon economy.
ClientEarth claimed that Shell had received a notification from ClientEarth regarding its claim. It was waiting for Shell’s response before filing papers at High Court of England, Wales. ClientEarth will need permission from the court in order to proceed with the case.
Shell responded to Reuters in writing, stating that it was implementing its global strategy to support the Paris Agreement on Climate Change. This included “transforming our business to offer more low-carbon energy to customers”.
“Resolving a problem as large as climate change requires all stakeholders to take action. The energy supply issues we are seeing highlight the need to have effective, government-led policy that addresses critical needs such energy security and decarbonisation. These problems cannot be solved through litigation,” Shell stated.
As countries seek to reduce their use of fossil fuels (a major cause of human-made global warming), energy companies face a challenge to their business models. They want to achieve net-zero greenhouse gases emissions by mid-century.
Shell has committed to halving the emissions from its operations by 2030. However, ClientEarth stated that its net-zero goal to reduce emissions from the use its products – which is the bulk of the emissions from an oil-and-gas company – was not enough.
ClientEarth also stated that Shell’s net zero target was not included in its operating plans or budgets.
A court in the Netherlands has already challenged the quality of the company’s climate transition program. They ordered it to go even further last year. Shell appeals the ruling.
The United Nations climate scientists reiterated the need to accelerate global action and stated failure to reach the Paris Agreement goal of limiting global warming to well under 2 degrees Celsius above preindustrial norms would cause irreparable damages.
ClientEarth announced that it was seeking to pursue Shell’s directors in connection with an alleged violation of the UK Companies Act. This law requires them act in a way that encourages the company’s success and exercise reasonable care and skill.
ClientEarth stated that it was taking legal action on behalf of all shareholders in Shell to ensure the long-term viability.