Royal Dutch Shell (RDSa.L) shareholders on Tuesday widely rejected a proposal by an environmental group calling for the oil company to set and publish annual targets to reduce carbon emissions.
The vote is a setback for climate activists who are increasing pressure on global oil companies, including U.S. firms Exxon Mobil (XOM.N) and Chevron (CVX.N), to become more ambitious in helping combat climate change.
Around 94 percent of Shell shareholders who cast a vote decided against resolution 21, according to final results reported following the company’s annual general meeting (AGM) in The Hague. Roughly 5 percent of voters abstained.
“The resolution is an unreasonable ask,” said Shell Chief Executive Ben van Beurden, promising to engage further with investors on how the oil company can become more transparent about its plans to tackle climate change.
Shell said binding emissions reduction targets would mean “tying its hands” and weakening the company because it would be forced to reduce production and sales.
Growing investor sensitivity to climate change risks have already led Shell to invest in renewable energy projects such as offshore wind farms.
Shareholders overwhelmingly approved the company’s new remuneration policy which for the first time ties 10 percent of executives’ bonuses to cutting greenhouse gas emissions.
Van Beurden’s speech at Tuesday’s AGM began with a 30 minute presentation of Shell’s initiatives to help lower carbon emissions.
Mark van Baal, founder of the Follow This activist group which put forward the resolution, said the group would target other oil companies such as BP (BP.L) as soon as funding was available.
There was also little opposition to a 60 percent increase in van Beurden’s pay package, with 93 percent of shareholders supporting it in Tuesday’s vote.
Last week, shareholders of rival London-listed oil company BP (BP.L) approved CEO Bob Dudley’s pay package, which was 40 percent lower than the previous year.
Last year, some 60 percent of shareholders voted against Dudley’s pay package of nearly $20 million.