Responsible Investment Annual Briefing updates
April 16, 2020
Royal Dutch Shell plc (Shell)
will today update investors on plans to become a net-zero emissions
energy business by 2050 or sooner (covering scope one, two and
three emissions). The detailed steps, to be outlined at Shell’s
Responsible Investment Annual Briefing today, will include:
- An ambition to be net zero on all the emissions from the
manufacture of all our products (scope one and two) by 2050 at the
latest;
- Accelerating Shell’s Net Carbon Footprint ambition to be in
step with society’s aim to limit the average temperature rise to
1.5 degrees Celsius in line with the goals of the Paris Agreement
on Climate Change. This means reducing the Net Carbon Footprint of
the energy products Shell sells to its customers by around 65% by
2050 (increased from around 50%), and by around 30% by 2035
(increased from around 20%);
- A pivot towards serving businesses and sectors that by 2050 are
also net-zero emissions.
“With the COVID-19 pandemic having a serious impact on people’s
health and our economies, these are extraordinary times. Yet even
at this time of immediate challenge, we must also maintain the
focus on the long term,” said Ben van Beurden, Chief Executive
Officer of Royal Dutch Shell.
“Society’s expectations have shifted quickly in the debate
around climate change. Shell now needs to go further with our own
ambitions, which is why we aim to be a net-zero emissions energy
business by 2050 or sooner. Society, and our customers, expect
nothing less.”
“This announcement significantly increases Shell’s ambitions and
commitments,” said Adam Matthews, Director of Ethics and Engagement
of the Church of England Pensions Board, Board Member of the
Institutional Investors Group on Climate Change, and Co-lead as
part of the Climate Action 100+ dialogue with Shell. “It is
indicative of Shell’s confidence in not only navigating the
immediate situation but rightly sets the focus on developing
net-zero pathways in key sectors that shape the demand for energy.
Ultimately, it will be by developing and supporting net-zero
pathways in these sectors that we will achieve the goals of the
Paris Agreement.”
Peter Ferket, Chief Investment Officer of Robeco, Co-lead as
part of the Climate Action 100+ dialogue with Shell, said: “These
new ambitions build on the 2018 joint statement between Shell and
Climate Action 100+. It proves that the strong and committed
engagement of institutional investors with Shell can help
accelerate the pace of change to deliver the goals of the Paris
Agreement. It raises the bar and sets out an approach for others in
the oil and gas sector to follow.”
Link here for more details on Shell’s climate ambitions
www.shell.com/netzeroambition
Also published today is an update to the 2019 Industry
Associations Climate Review, available here
www.shell.com/advocacy
Enquiries:
Investor
RelationsInternational: +31 70 377 4540North America: +1
832 337 2034
Media RelationsInternational:
+44 207 934 5550US: +1 832 337 4355
Notes to
editors:
- In 2017, Shell was the first international oil and gas company
to set the ambition to reduce the Net Carbon Footprint of the
energy products it sells, expressed as a measure of carbon
intensity, taking into account their full life-cycle emissions.
Shell aimed to reduce the Net Carbon Footprint of its energy
products by around half by 2050, and by around 20% by 2035, in step
with society’s drive to meet the goals of the Paris Agreement. In
2018, with unprecedented levels of collaboration with investors,
Shell announced its intention to build on that long-term ambition
with the commitment to setting specific Net Carbon Footprint
targets for shorter periods, of three or five years, linking them
to executive remuneration. In early 2019 Shell set an
unconditional three-year target (to 2021) to reduce its Net
Carbon Footprint by 2% to 3% compared to 2016, linked to senior
executive remuneration. For the 2020 unconditional three-year
target (to 2022) the target range is a 3-4% reduction in its Net
Carbon Footprint against the 2016 baseline, linked to remuneration
for more than 16,500 staff. It is intended that this
target setting will be done annually, with
each year’s target covering a three-year period.
- Shell will track and report on progress in achieving both the
aim to reduce the Net Carbon Footprint of the energy products it
supplies, as well as progress towards achieving net-zero emissions
from its operations. Shell will also work to develop a method for
tracking and reporting emission reduction by its customers.
Tracking and reporting the reduction of customer emissions will
require the development of appropriate accounting methodologies and
frameworks.
- As of today, Shell’s operating plans and budgets do not reflect
these newly announced ambitions. Shell’s aim is that, in the
future, its operating plans and budgets will change to reflect this
movement towards its new net-zero emissions ambition. These plans
and budgets need to be in step with the movement towards a net-zero
emissions economy within society and among Shell’s customers.
- Shell is assisting customers, communities and colleagues in a
number of ways in response to COVID-19. Steps include enhanced
health and safety measures at all our retail sites globally, and
free food and drink at more than 15,000 retail sites across 30
countries for health-care professionals, truck drivers and delivery
people. Other measures include donating ingredients for
hand-sanitising products across several countries, including 2.5
million litres of isopropyl alcohol to the Dutch health-care
sector. To read about Shell’s full response across the globe to
COVID-19, go to www.shell.com/covid19
Cautionary note
The companies in which Royal Dutch Shell plc
directly and indirectly owns investments are separate legal
entities. In this release “Shell”, “Shell Group” and “Royal Dutch
Shell” are sometimes used for convenience where references are made
to Royal Dutch Shell plc and its subsidiaries in general. Likewise,
the words “we”, “us” and “our” are also used to refer to Royal
Dutch Shell plc and its subsidiaries in general or to those who
work for them. These terms are also used where no useful purpose is
served by identifying the particular entity or entities.
‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as
used in this release refer to entities over which Royal Dutch Shell
plc either directly or indirectly has control. Entities and
unincorporated arrangements over which Shell has joint control are
generally referred to as “joint ventures” and “joint operations”,
respectively. Entities over which Shell has significant
influence but neither control nor joint control are referred to as
“associates”. The term “Shell interest” is used for convenience to
indicate the direct and/or indirect ownership interest held by
Shell in an entity or unincorporated joint arrangement, after
exclusion of all third-party interest.
It is important to note that as of April 16, 2020, Shell’s
operating plans and budgets do not reflect Shell’s net-zero
emissions ambition. Shell’s aim is that, in the future, its
operating plans and budgets will change to reflect this movement
towards its new net-zero emissions ambition. However, these plans
and budgets need to be in step with the movement towards a net zero
emissions economy within society and among Shell’s
customers.
Also, in this release we may refer to Shell’s “Net Carbon
Footprint”, which includes Shell’s carbon emissions from the
production of our energy products, our suppliers’ carbon emissions
in supplying energy for that production and our customers’ carbon
emissions associated with their use of the energy products we sell.
Shell only controls its own emissions. The use of the term Shell’s
“Net Carbon Footprint” is for convenience only and not intended to
suggest these emissions are those of Shell or its subsidiaries.
This release contains forward-looking statements
(within the meaning of the U.S. Private Securities Litigation
Reform Act of 1995) concerning the financial condition, results of
operations and businesses of Royal Dutch Shell. All statements
other than statements of historical fact are, or may be deemed to
be, forward-looking statements. Forward-looking statements are
statements of future expectations that are based on management’s
current expectations and assumptions and involve known and unknown
risks and uncertainties that could cause actual results,
performance or events to differ materially from those expressed or
implied in these statements. Forward-looking statements include,
among other things, statements concerning the potential exposure of
Royal Dutch Shell to market risks and statements expressing
management’s expectations, beliefs, estimates, forecasts,
projections and assumptions. These forward-looking statements are
identified by their use of terms and phrases such as “aim”,
“ambition”, ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’,
‘‘expect’’, ‘‘goals’’, ‘‘intend’’, ‘‘may’’, ‘‘objectives’’,
‘‘outlook’’, ‘‘plan’’, ‘‘probably’’, ‘‘project’’, ‘‘risks’’,
“schedule”, ‘‘seek’’, ‘‘should’’, ‘‘target’’, ‘‘will’’ and similar
terms and phrases. There are a number of factors that could affect
the future operations of Royal Dutch Shell and could cause those
results to differ materially from those expressed in the
forward-looking statements included in this release, including
(without limitation): (a) price fluctuations in crude oil and
natural gas; (b) changes in demand for Shell’s products; (c)
currency fluctuations; (d) drilling and production results; (e)
reserves estimates; (f) loss of market share and industry
competition; (g) environmental and physical risks; (h) risks
associated with the identification of suitable potential
acquisition properties and targets, and successful negotiation and
completion of such transactions; (i) the risk of doing business in
developing countries and countries subject to international
sanctions; (j) legislative, fiscal and regulatory developments
including regulatory measures addressing climate change; (k)
economic and financial market conditions in various countries and
regions; (l) political risks, including the risks of expropriation
and renegotiation of the terms of contracts with governmental
entities, delays or advancements in the approval of projects and
delays in the reimbursement for shared costs; (m) risks associated
with the impact of pandemics, such as the COVID-19 (coronavirus)
outbreak; and (n) changes in trading conditions. No assurance is
provided that future dividend payments will match or exceed
previous dividend payments. All forward-looking statements
contained in this release are expressly qualified in their entirety
by the cautionary statements contained or referred to in this
section. Readers should not place undue reliance on forward-looking
statements. Additional risk factors that may affect future results
are contained in Royal Dutch Shell’s Form 20-F for the year ended
December 31, 2019 (available at www.shell.com/investor and
www.sec.gov). These risk factors also expressly qualify all
forward-looking statements contained in this release and should be
considered by the reader. Each forward-looking statement
speaks only as of the date of this release, April 16, 2020. Neither
Royal Dutch Shell plc nor any of its subsidiaries undertake any
obligation to publicly update or revise any forward-looking
statement as a result of new information, future events or other
information. In light of these risks, results could differ
materially from those stated, implied or inferred from the
forward-looking statements contained in this release.
We may have used certain terms, such as
resources, in this release that the United States Securities and
Exchange Commission (SEC) strictly prohibits us from including in
our filings with the SEC. Investors are urged to consider
closely the disclosure in our Form 20-F, File No 1-32575, available
on the SEC website www.sec.gov.