Shareholder advisory group Glass Lewis backs Shell's climate plan

By Ron Bousso

LONDON (Reuters) - U.S. proxy advisory company Glass Lewis recommends Royal Dutch Shell's shareholders vote in favour of the company's energy transition plan at its May 18 annual general meeting, a document seen by Reuters showed.

Glass Lewis also recommended voting against a shareholder resolution filed by activist group Follow This calling for the Anglo-Dutch energy company to set stricter targets for cutting greenhouse gas emissions.

Shell aims to achieve net zero carbon emissions by 2050 by reducing oil output, boosting renewable energy and low-carbon fuels as well as developing carbon offsets from nature-based or carbon capture projects.

"We believe that the company lays out a robust plan to achieve its net zero ambition and that its disclosure concerning this plan is comprehensible and thorough," Glass Lewis said in a report seen by Reuters.

"We will continue to track this quickly evolving issue and may consider revising our approach on a future proposal should it become apparent that the company is not meaningfully responding to shareholder concerns," it said.

WATCH: Shell raises its dividend as profits surge

Shell Chief Financial Officer Jessica Uhl said on Thursday that the company's plan was one of the most ambitious for the oil and gas sector.

But some investors believe the strategy does not go far enough.

Britain's Local Authority Pension Fund Forum (LAPFF) said on Wednesday that Shell's strategy risks leaving many of its oil and gas reserves stranded, advising investors to vote against the non-biding resolution.

Asset manager Sarasin & Partners said on Thursday that it would also vote against Shell's transition plan.

"Until their financial statements properly reflect the implications of a net zero pathway, it is impossible to know whether the transition plan is credible or economically feasible," Sarasin said in a statement.

The asset manager said it would vote in favour of the Follow This resolution, which Shell's board has urged investors to oppose.

WATCH: Top tips for helping the environment on a tight budget

(Reporting by Ron Bousso; Editing by David Clarke)