Royal Dutch Shell is giving its executives a powerful new reason to care about the environment. The energy firm said that it will establish short-term carbon emissions targets starting in 2020 after increasing pressure from investors. In an industry first, it plans to link executive pay to hitting target emission goals.
Major shareholders including the Church of England and Robeco have demanded that Shell do more to tackle emissions, as they believe the company’s intial goal of cutting carbon emissions in half by 2050 is not enough.
Shell said in a statement that it would set carbon reduction goals that cover periods of three to five years. These targets will be set on an annual basis and run to 2050. The oil giant however has yet to set out the specific carbon benchmarks they intend to meet and said shareholders would not vote on the proposed changes until 2020.
Climate Action 100+, a group of 310 investors with over $32 trillion in assets under management, said in a joint statement with Shell that it strongly supported the company in taking "these important steps." Shell made the announcement as the United Nations’ annual talks on climate change got underway in Poland.