The Final Push

However, the energy crisis will ultimately accelerate the clean energy transition, which means the energy trilemma should not become a Bermuda triangle into which climate ambitions disappear.

Over the last few months, many oil and gas companies had their annual general meetings (AGMs). At these meetings, PGGM used its voting rights to encourage such companies to set Paris-aligned emission reduction targets. And this year, we took it one step further by co-filing a resolution at TotalEnergies.

In the lead up to the AGMs, PGGM sponsored a report by Accela Research on the climate transition strategies of several European oil and gas majors. Accela found that current capital expenditures predominantly remain concentrated in oil and gas production rather than developing low-carbon solutions. Based on this report and internal research, we concluded that there is insufficient evidence that any of these five majors is aligned with the goal to limit global warming to 1.5C.

Next to sponsoring the report, we publicly disclosed our voting intentions on important climate proposals and spoke to various newspapers about our oil and gas engagement program. For example, articles in the Dutch daily NRC outline our engagement with Shell as lead engagers of Climate Action 100+ and our reason for voting in favour of the Follow This resolution at Shell, where we ask the company to set Paris-aligned targets.

We also gave a statement at the annual meeting of Shell together with our co-leads MN and Phoenix Group, in which we asked the company to take further and bolder steps to enable the energy transition. We voted in favour of the Follow This resolution, which obtained 20% of votes in favour, similar to last year’s voting outcome. Although the lack of an increase in support is disappointing, we are glad that the downward trend in support (from 30% support in 2021 to 20% in 2022) did not occur with Shell.

PGGM was more involved at TotalEnergies, by being part of a group of 17 investors and Follow This co-filing the Paris-alignment resolution. We intensely collaborated with this group over the last few weeks and jointly met with TotalEnergies’ CEO Patrick Pouyanné to discuss the company’s climate transition strategy. Because we were not satisfied with the company’s response, we moved ahead with the resolution, and 30% of votes were cast in favour. This outcome signals that a substantial proportion of investors in TotalEnergies want the company to strengthen its 2030 emission reduction target.

This contrasts starkly with the voting results at the US Oil Majors’ AGMs. For example, only 9% of Chevron shareholders supported the Follow This resolution, asking for Paris-aligned targets. This represents a significant decrease from 2022 when the same resolution achieved 33% support. This result clearly demonstrates the growing gap in climate ambition between US and European oil and gas companies and their investors. PGGM focuses engagement on more willing oil and gas companies and votes against the re-election of board members at laggards like Chevron.

Over the next few months, we will continue our dialogues with BP, Shell, TotalEnergies, and other companies to encourage them to set Paris-aligned targets supported by a credible strategy. Oil and gas companies that do not meet our expectations by the end of the year will be divested. However, the energy transition is not the sole responsibility of these companies. It will only happen through joint efforts of investors, policymakers, and energy-consuming companies. Therefore, we call on all stakeholders to take responsibility and collaborate to fight climate chan