Climate activist shareholder group Follow This has resumed its campaign, filing new shareholder resolutions with UK supermajors BP and Shell. This marks a significant strategic shift from previous climate-focused efforts to a new emphasis on financial performance and shareholder value creation.

Strategic Shift and Rationale

The group paused its activities to reassess strategy due to declining investor interest in climate action. After discussions with institutional investors and analysis of voting patterns, it concluded that a disclosure request focused on financial performance is the most effective path forward. This approach aligns with investors' core responsibility of assessing value and risk.

Details of the Resolutions

The resolutions, co-filed by 23 institutional investors representing €1.5 trillion in assets, were submitted ahead of the companies' annual general meetings. They call for BP and Shell to publish detailed analysis regarding their planned capital expenditure on oil and gas developments, free cash flow, and production forecasts for the next decade. This analysis must be presented under different International Energy Agency (IEA) demand scenarios. The rationale is that if declining demand undermines shareholder value, company boards must be transparent about whether they plan to transition or manage an orderly wind-down of operations.

Context of Declining Support for Climate Resolutions

This new financial focus follows a period where support for previous resolutions—which targeted emissions reductions—has stagnated. Support peaked in the early 2020s with 30% to 58% shareholder backing but has since fallen to around 20% since 2024. This decline is attributed to the supermajors shifting away from low-carbon investments and legal action in the US against investors supporting climate action.

Market Outlook and Company Response

The resolutions are filed against a complex market backdrop. Forecasts indicate an oil market oversupply this year, but analysts warn of a potential supply gap by 2035 due to underinvestment, rising demand, and depleting resources. On demand, the IEA's latest long-term outlook, under its stated policies scenario, projects oil demand growing well into the 2030s as hydrocarbons continue to play a role alongside low-carbon technologies. In response to the resolution, Shell stated its board will consider it and respond with a recommendation to shareholders in the AGM notice.

Investor Perspective

Co-filing investors emphasize the need for strategic transparency. They expect the companies to clearly outline the strategic levers management can use to create resilience and generate shareholder value under a range of plausible future scenarios, linking long-term business resilience directly to financial performance.