Climate group sues Shell directors over climate inaction
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Climate group sues Shell directors over climate inaction

Environmental law organization ClientEarth Tuesday announced legal action against the Board of Directors of Shell over the company’s failure to adopt and implement a climate strategy plan.

ClientEarth, as a shareholder, seeks to hold the company’s 13 directors personally liable for breaching their duties under the UK Companies Act by arguing that the Board has failed to adopt and implement an adequate climate strategy. The organization described their action as “the first ever case seeking to hold company directors personally liable for failing to properly prepare for the energy transition.”

Within their announcement, ClientEarth stated that they were acting in Shell’s best interests on behalf of all stakeholders to help protect the long-term commercial viability through pursuing the action.

Paul Benson, ClientEarth lawyer explained that:

Shell is seriously exposed to the physical and transitional risks of climate change, yet its climate plan is fundamentally flawed. If, as we claim, the company’s plan is being held up to be Paris-aligned when it is not, then there is a risk of misleading investors and the market at large.

Shell’s climate transition plan was already challenged last year in the Netherlands in a landmark ruling where the company was ordered to drastically reduce its group-wide emissions. Shell appealed the ruling after directors labeled the verdict “unreasonable”.

ClientEarth stated that they had notified Shell of the claim and are waiting for a response before filing papers at the High Court of England and Wales. ClientEarth will need permission from the Court to proceed with the case.