Oil producer Shell today proposed linking its executives’ pay to their ability to reduce the company’s greenhouse gas emissions.
The Anglo-Dutch giant said it would start setting three to five-year pay-linked targets for 1,200 of the most senior members of its team.
It is part of a long-term plan to meet goals in the Paris climate change agreement, putting Shell on a course to slash carbon emissions from its products by half in the next 32 years, and 20 per cent by 2035.
The proposals will be put to shareholders at an investor meeting in 2020, the first available opportunity.
The Archbishop of Canterbury Justin Welby, whose church is a major investor in Shell, said: “As governments meet at the United Nations climate negotiations in Poland, I am delighted to see a unique announcement on climate change between investors and one of the largest companies in the world — Royal Dutch Shell.
“This sets Shell on a path to reducing the net carbon footprint of its energy products. The reduction is supported by a clear framework of targets and transparent reporting.”
The deal has been developed alongside the Climate Action 100+ investor group, a five-year initiative to drive clean energy initiatives.
The group’s 310 members, which control more than $32 trillion (£25 trillion) in assets, encourage major greenhouse gas emitters to help drive the Paris agreement forward.
“Meeting the challenge of tackling climate change requires unprecedented collaboration and this is demonstrated by our engagements with investors,” said Shell chief executive Ben van Beurden.
“We are taking important steps towards turning our Net Carbon Footprint ambition into reality by setting shorter-term targets. This ambition positions the company well for the future and seeks to ensure we thrive as the world works to meet the goals of the Paris agreement on climate change.”