As Royal Dutch Shell holds its annual general meeting today, Fossil Free Europe and Friends of the Earth warn that capital invested in the oil company is at risk of going to waste. Retirement money, municipal funds and citizens’ savings are at stake. Pension funds, municipalities and banks need to ditch their high-carbon investments urgently.
A series of recent studies underpin this warning. A new report launched today by Friends of the Earth titled “Shell’s carbon bubble” shows that capital invested in the oil company is at risk of seeing no return on investment.
Another recent report by London-based think tank Carbon Tracker Initiative found that fossil fuel companies bet more than $ 1 trillion on high-risk oil projects over the next decade. It warned investors of the high demand and price assumptions that these spendings are based on, which risks investors’ capital being wasted. The report identified Royal Dutch Shell as one of the top three oil companies with the highest risk.
Investors arriving at the Shell annual general meeting in the Hague and London were greeted with messages about Shell’s carbon bubble by campaigners of 350.org and Friends of the Earth.
In Sweden and the Netherlands, Fossil Free campaigners warned that billions in retirement money are at risk. Dutch pension fund ABP has € 962 million invested in Shell and € 10 billion in fossil fuels overall. The Swedish national pension funds (AP funds) have investments of SEK 1,163 million in Shell and a total of SEK 3 billion in fossil fuels.
In Germany, campaigners highlighted the high financial risk municipalities and private customers of the public banks (Sparkassen) are exposed to because of its investments in high-carbon assets via its central asset manager DekaBank. DekaBank has € 188 million invested in Shell and € 900 million in fossil fuels. Fossil Free Germany placed carbon bubbles in front of the Sparkassen branch at Berlin’s iconic Alexanderplatz.
Shell, Exxon and the like have made it very clear that they are happy to gamble shareholders’ money on high-risk fossil fuel projects and runaway climate change. In a letter to investors from May 16, Shell affirmed that it has no intention of addressing the risks of its carbon bubble and will continue to burn through its reserves betting on high demand and price.
Shell itself has warned earlier this year that its profitability will be hit as governments step up efforts to reduce greenhouse gas emissions, after it had previously reported a 48% decline in expected earnings.
Pension funds, municipalities and public banks need to stop funding the fossil fuel industry instead of wasting our money on reckless oil, coal and gas projects.
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