Campaign group ClientEarth is looking to appeal the High Court’s dismissal of its claim against Shell’s directors, after it did so a second time. The group will need permission before an appeal can go ahead. 

 

On 12 July, the campaigners sought to convince the court to overturn its May decision to dismiss a claim against the Anglo-Dutch oil and gas giant. ClientEarth is seeking a full trial against the directors of Shell because of what it says is a “flawed” climate strategy.  

 

The group alleges that Shell’s directors are in breach of their legal duties under the UK Companies Act to manage risks to the company that could harm its future success, saying the climate crisis presents the biggest risk of all.  

 
Several UK pension funds have expressed interest in and support for the claim, including master trust Nest and local government pension pools the London CIV and LGPS Central. 

 

“The board’s refusal to take decisive action to prepare the company for the fast-advancing energy transition puts Shell’s future commercial viability at risk and, we maintain, is in breach of the board’s duties under English law,” said Paul Benson, a ClientEarth lawyer. 

 

A spokesperson for Shell said about the renewed dismissal of the claim: “This is the right outcome – the court has reaffirmed its decision that this claim is fundamentally flawed and has, once again, dismissed it.” 

 

Shell argued its directors have always complied with their duties, saying the claim “ignores how directors of a business as large and complex as Shell must balance a range of competing considerations”. 

 

The spokesperson called the claim “utterly misconceived and a clear misuse of the English courts”, adding: “Should ClientEarth seek permission to appeal, we remain confident that the court will stand by its rulings.” 

 

According to Shell, Justice Trower found that the directors’ decision to set the climate strategy did not change the content of their statutory duties. The main issue was the absence of a prima facie case in the judge’s view, who said the remedies sought by ClientEarth were “imprecise” and that the courts were “reluctant to interfere with bona fide business decision-making”. 

 

Since the first claim was first brought, Shell’s board has decided to keep oil production stable until 2030. The firm argued it hit a target to reduce production by 1-2% each year from 2019 to 2030 last year, having reduced production by 20%. Shell said this was due to a combination of natural decline in its upstream business and divestments, adding: “Part of those divestments, but not all, was the sale of Shell’s Permian assets to ConocoPhillips.” The stake was sold in 2021 for $9.5bn (£7.4bn).  

   

    

How likely is it that ClientEarth will receive permission to appeal the dismissal?