Shareholders of oil and gas giant Royal Dutch Shell voted overwhelmingly on Tuesday in favour of its controversial climate strategy to reduce reliance on fossil fuels and become carbon neutral by 2050.
The plan sets targets but does not include a shift away from hydrocarbons that account for most of its profits, even as the International Energy Agency said the sector must halt all exploration projects to keep global warming under control.
At the Anglo-Dutch group's annual general meeting, nearly 89 percent of shareholders approved the plan to reduce carbon dioxide emissions, according to a statement.
Another resolution, put forward by the environmental organisation Follow This, which called on Shell to set more ambitious targets, was supported by just over 30 percent.
It was not backed by Shell's management.
Group chief executive Ben van Beurden called the plan "comprehensive, rigorous and ambitious" and "a first" for an energy company, applauding shareholders' backing.
He added that he would "take note" of the outcome of the Follow This resolution, promising to get back to investors within six months.
For the NGO Greenpeace, the support for the Follow This proposal, which more than doubled from last year, showed "a significant drop in investor confidence and a lack of faith in Shell's shambolic climate plan".
It pointed out that the group still wants to increase its gas production by 20 percent by 2030, and called on the British government to ban new oil and gas projects.
Follow This had also proposed a similar resolution to UK giant BP, which was supported by 20.65 percent of shareholders last week -- a sharp rise from 2020.
Shell unveiled details of its strategy to become carbon neutral in February through investment in new energy and a reduction in its reliance on oil, while still relying heavily on gas, its core strength.
It expects its oil production to fall by 1-2 percent each year.
Shell had previously said that its oil production had peaked in 2019, before the coronavirus pandemic hit the market hard.
- Planting trees -
The company also intends to gradually reduce its net carbon intensity -- carbon emissions on all energy produced -- by 6-8 percent by 2023, 20 percent by 2030, 45 percent by 2035 and completely by 2050.
However, environmental groups, including Follow This, are calling for Shell to set short- and medium-term targets for absolute emissions reductions, which it has not done so far.
They believe that would be more effective in meeting the 2015 Paris agreements to limit global temperature 1.5 degrees Celsius (2.7 degrees Fahrenheit) above pre-industrial levels.
Van Beurden reiterated at the start of the general meeting that Shell had no intention of getting out of hydrocarbons, as it would not help the company or its shareholders.
If it stopped producing, a competitor would take its place because of continued demand, he added.
But he acknowledged that the measures may not be enough, passing responsibility on to customers.
"In the end, people would have to substitute high carbon-based energy for low carbon-based energy. The substitution process is actually in its infancy," he added.
"That's sad and difficult to hear but true."
To meet its commitments, Shell will increase its presence in still-unproven carbon capture technology.
It will also use offsetting mechanisms, also criticised by NGOs because they do not lead to a reduction in hydrocarbon extraction but to the financing of green projects to balance these emissions.
ActionAid has calculated that this would mean planting 12 million hectares of trees by 2030 -- three times the size of the Netherlands.