It has not been a good few days for Big Oil.
Shareholders on Wednesday rebuked the top two U.S. oil companies for dragging their feet on fighting climate change, while a Dutch court ruled that Royal Dutch Shell needs to accelerate cuts to greenhouse gas emissions.
On Thursday, an Australian court ruled that the country’s environment minister has an obligation to children to consider the harm caused by climate change as part of her decision-making in approving the expansion of a new coal mine.
“Today was a stark warning for Big Oil,” Bess Joffe, of the Church Commissioners for England, which manages the Church of England’s investment fund, said on Wednesday. Executives were “being held to account by investors and lawmakers,” she added.
Exxon Mobil lost at least two board seats to an activist hedge fund, shareholders at Chevron endorsed a call to further reduce its emissions and a court deemed Royal Dutch Shell’s emissions targets insufficient.
Investor support for climate concerns could force oil and gas companies to rethink how fast they pivot to other forms of energy. BP Plc, which recently pledged to consult with shareholders on its climate targets, could see the next test of the groundswell.
A Dutch court ordered Shell to slash its carbon dioxide emissions by 2030.
Dissident win
Shell said it would appeal, and analysts called the decision not the last word in the case.
“This ruling has negligible chance to survive appeals,” said Per Magnus Nysveen, of energy consultancy Rystad Energy.
In a stunning blow to top management at Exxon, shareholders elected two change candidates for its board and approved measures calling for annual reports on climate and grassroots lobbying efforts. Activists could yet win a third seat with some votes still to be counted and the full board not yet known.
After the meeting, CEO Darren Woods said Exxon heard shareholders’ desire to advance lower-carbon and cost-cutting efforts.
“We are well positioned to respond,” he said.
Chevron shareholders backed a call for the company to cut emissions from the end-use of its fuels with 61% supporting the petition. Another resolution calling for a report on the business impact of achieving net zero emissions by 2050 was backed by 48 percent of votes cast.
“The question for oil companies is when and how much” do they reduce oil and gas production in response to investor and social concerns, said Charles Elson, a professor of corporate governance at the University of Delaware.
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Investors have registered protests over the slow pace of change, but corporate executives will have to evaluate how to implement what are non-binding resolutions, he said.
The votes signal a new sense of urgency, said Mark Van Baal, who leads a climate advocacy group that placed resolutions calling for emissions cuts at Chevron, ConocoPhillips and Phillips66. All got at least 58% support.
Investors are saying: “we want you to act by decreasing emissions now, not in the distant future,” he said.
Future harm
Separately, the Federal Court of Australia’s ruling that the government must consider the impact of climate change when deciding whether to approve the expansion of a new coal mine was also momentous.
The ruling came response to a class action suit brought by eight teenagers that argued the expansion of Whitehaven Coal Ltd’s Vickery Project in New South Wales state would contribute to climate change and endanger their future.
In his ruling, Justice Mordecai Bromberg said that Australia’s environment minister could foresee the possibility of future harm caused to the children in the case by the increase in carbon dioxide emissions from Whitehaven’s expansion and therefore must recognize a so-called duty of care, or moral obligation, to the children, when approving it.
The court stopped short of issuing an injunction to prevent the minister from approving the expansion, however.
Source: | This article originally belongs to Nbcnews.com
