What’s going on here?
Oil and gas giant, Shell, is facing legal action on multiple fronts – including a landmark lawsuit which is the first notable one of its kind. The new lawsuit will target Shell’s senior leadership directly.
What does this mean?
Shell’s board of directors is being sued by Client Earth, an environmental law charity, on the grounds that they are not adequately preparing the company for the global switch to clean energy. The lawsuit represents the first of its kind, whereby directors themselves are being held to account by their own shareholders for failing to provide an effective strategy for transitioning away from the use of fossil fuels. This differs from other lawsuits in which Shell has been sued as a corporate legal entity.
Shell, which made record annual profits of £32.2bn last year, is also facing legal action in multiple other areas. A ruling from the Dutch court in 2021 has mounted pressure, stating that Shell must reduce the emissions generated from its products by 45% (compared to 2019 levels) by 2030. Furthermore, Shell is being sued in London’s high court by 13,000 people whose lives have been affected by oil spills in Nigeria.
Why should we care?
Oil and gas companies have been notoriously slow to act to address the climate crisis. In fact, some of the major companies knew about the harmful consequences of continued CO2 emissions as long as 40 years ago, and yet they have done little to curb the world’s addiction to fossil fuels. In recent years oil and gas firms have been accused of greenwashing; claiming that they are addressing concerns about the climate crisis whilst continuing to invest heavily in the development of new and existing fossil fuel extraction projects.
The new lawsuit facing Shell’s board of directors could present a critical means of holding individuals to account. Even if not successful, the legal action highlights the fact that individuals are the decision makers when it comes to how a company plans to address its climate impact. Critically, the lawsuit could shape the way companies set out their climate change reduction road-maps. If the ruling is successful, it could mean companies may face legal action for not adequately preparing for the future and therefore encourage stricter measures to be put in place.
- Dive deep into the Drilled podcast – which looks at the dirty history of fossil fuel companies.
- Support Client Earth by donation.
- Learn about other recent legal battles involving fossil fuels: Greenpeace vs UK Goverment; Client Earth vs UK Goverment.
- Follow the Paid to Pollute movement.