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Follow This and BP in talks to test shareholder support for climate targets resolution in 2021

Similar resolutions filed at Shell and Equinor eye a ‘Paris-consistent’ mandate from shareholders

Dutch climate finance group Follow This has filed a proposal at BP, with “input” from the oil major itself, as part of a collaborative process to set emissions reduction targets, including plans to tackle scope 3 emissions.

In March this year, Follow This withdrew a similar resolution in order to give BP a chance to elaborate on its scope 3 emissions and Paris-aligned capex on the back of its new Net Zero ambitions. The ambitions were launched in February under the leadership of BP’s new CEO, Bernard Looney, who is the first to suggest that the firm should be accountable for scope 3 emissions. 

At the time, BP and Follow This made the unusual move of agreeing to co-develop a proposal to be voted on by shareholders in 2021. As the deadline for submission approaches, Follow This founder Mark van Baal told RI that a resolution has been filed that takes “all BP’s input into account” and seeks to garner shareholder support for the firm to set “Paris-consistent emissions reduction targets and invest accordingly”.

The text of the resolution has not been released yet, but Van Baal explained that small changes have been made from the original 2020 proposal, to ensure it is “agnostic” and not prescriptive about how BP selects Paris-consistent targets. He said he hopes BP’s board recommends to vote in favour of the resolution.

A spokesperson for BP confirmed that both parties have been “in discussion”, but said details were confidential. The spokesperson confirmed that BP “received a proposed resolution from Follow This” and added that “we will verify that it meets the appropriate criteria and fully consider it before responding”.

The same resolution has been filed at Shell and Equinor for 2021, following record levels of investor support for Follow This proposals in 2020: 14.4% at Shell and 27% of independent shareholders at Equinor. The California Public Employees' Retirement System and the UK’s asset manager M&G were among the big names to support both resolutions.

M&G’s voting rationale stated that Shell “should provide comprehensive disclosure to shareholders on its environmental impacts and risks” and that it was in the interests of Equinor’s shareholders to support the resolution. 

Meanwhile, it has emerged that Friends of the Earth Netherlands has initiated a climate lawsuit against Shell, with hearings scheduled for this week.  

The NGO is not asking for pecuniary compensation but for Shell to commit to reducing CO2 emissions by 45% in 2030. 

Dutch climate lawyer Roger Cox, who successfully brought a climate-related lawsuit against the Dutch Government, is representing Friends of the Earth.  

It is understood that he will use Shell’s rejection of the shareholder proposals filed by Follow This as an exhibit. 

Van Baal said Follow This is not involved in the legal case, but that Shell may address the concerns by supporting the 2021 climate resolution.