Call to use pay to help planet

ShareAction, a charity promoting responsible investment by pension funds and fund managers, has urged Shell and BP investors to use their votes on pay plans to encourage bosses to embrace green energy.

Sticking with old remuneration policies which reward executives for “replenishing fossil fuel reserves” will lead to both companies becoming obsolete, it warned.

Rules introduced in 2013 mean large companies like Shell and BP face binding shareholder votes on threeyear pay policies next year.

ShareAction chief executive Catherine Howarth said: “Responsible

“High-carbon pathways puts significant value at risk”

investors who are serious about climate risk have a crucial opportunity to walk the talk at BP and Shell next year by pushing for remuneration policies designed make these maj o r compan ies commercially resilient in a low-carbon world.”

Juliet Phillips, campaigns Manager at ShareAction and author of anewreport about incentive structures at oil and gas companies, added: “In the context of a decarbonising economy, the pursuit of highcarbon pathways puts significant value at risk for long-term investors in fossil fuel companies.

“In their engagements with BP and Shell, shareholders must reinforce the need for a climate-smart strategy, reflected in remuneration policies that signal and reward the steps required to achieve lowcarbon resilience.”

BP said it would consult shareholders on its pay plans before the end of 2016, while Shell said it would read the report with interest.