ClientEarth Shell Climate Change Lawsuit Overview:
- Who: Environmental group ClientEarth has filed a shareholder derivative lawsuit against Shell’s board of directors.
- Why: ClientEarth claims Shell’s board of directors is failing to properly prepare for climate change and a transition to clean energy.
- Where: The lawsuit was filed in the UK.
The board of directors for Shell are being accused of failing to properly prepare for the transition to cleaner energy in the face of climate change, according to a shareholder derivative lawsuit.
The lawsuit, filed by the environmental group ClientEarth, is meant to hold Shell accountable for doing what is in the best interest of the company, its shareholders and the planet, the group says.
“We are pursuing shareholder litigation to compel Shell’s board to act in the best long-term interests of the company by strengthening Shell’s climate plans,” ClientEarth says on its website.
ClientEarth claims Shell’s current strategy for transitioning to clean energy is “insufficient” and puts the future of the company and its employees at risk.
Further, ClientEarth argues Shell is putting the health of the planet and its inhabitants at risk by taking a “wait and see” approach to the energy transition and “breaching its legal duties” to “properly manage climate risk.”
Shell Not Truly Aligned With Paris Agreement Goal, Group Says
“The board has failed to adopt and implement a climate strategy that truly aligns with the Paris Agreement goal to keep global temperature rises to below 1.5°C by 2050,” ClientEarth says.
ClientEarth claims Shell’s alleged inaction is in violation of sections 172 and 174 of the UK Companies Act, which “legally requires it to act in a way that promotes the company’s success and to exercise reasonable care, skill and diligence.”
The environmental group says it wants to compel Shell to put “sufficient targets” in place so that it can reduce its emissions through the next 10 years to “meet net zero will secure the company’s long-term value while protecting investors’ capital and the climate.”
“This will be the first time ever that a company’s board has been challenged on its failure to properly prepare for the net zero transition,” ClientEarth says.
In 2020, the UK was part of 33 countries targeted in a lawsuit filed by six Portuguese children demanding the countries take action to curb climate change after they were forced to endure deadly wildfires and heat waves.
Do you believe Shell is prepared for the theta of climate change and transition to clean energy? Let us know in the comments!
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