The District Court of The Hague in the Netherlands has ordered oil giant Royal Dutch Shell to cut carbon emissions by 45% by 2030. The company was told it had a duty of care and that the level of emission reductions of Shell and its suppliers and buyers should be brought into line with the Paris climate agreement. This decision was reached in the court case of Milieudefensie et al v Royal Dutch Shell C/09/571932. The case is unique in that no compensation is being demanded from Royal Dutch Shell. Instead, for the first time in history, the company is being asked to issue a policy change.
Royal Dutch Shell signed the Paris Agreement back in 2016. At that time, the company was considered the ninth-largest contributor to global pollution, contributing about 1% to global emissions. However, in 2014, Royal Dutch Shell began to assess what they could do to address emissions but it eventually formed the opinion that the Paris targets were unattainable and therefore, decided not to change its business model away from oil and gas. Nonetheless, Royal Dutch Shell did release a plan in which it planned to reduce carbon dioxide emissions by 30% by 2035 and by 65% by 2050.
This plan was considered to be far too slow and seven environmental foundations – Miliedefensie voor Veranderaars, Greenpeace, Fossielvrij, Waddenvereniging, Both ENDS, Jongeren Milieu Actief, and ActionAid - joined together with 17,379 individual claimants in the Netherlands to file a class-action lawsuit against Royal Dutch Shell in April 2019. They argued that Royal Dutch Shell could change its business model to invest more in renewable energy, and reach an emissions reduction target of 45% by 2030. If the company fails to do so, it would be in breach of the unwritten standard of care laid down in Book 6 Section 162 of the Dutch civil code as well as articles 2 and 8 of the European Convention on Human Rights.
In response, Royal Dutch Shell said in February it would accelerate the transition of its business to net-zero emissions, including targets to reduce the carbon intensity of energy products by 6-8% by 2023, 20% by 2030, 45% by 2035, and 100% by 2050. However, the plaintiffs successfully argued that the company had been aware for decades of the dangerous consequences of carbon dioxide emissions and its targets remained insufficiently robust.
The district court of the Hague agreed with the plaintiffs and found that Royal Dutch Shell’s current sustainability policy was insufficiently “concrete”, and that its emissions were greater than that of most countries. Due to these factors, the court ordered that the company must reduce its global emissions by 45% by 2030; the reduction targets include emissions from its suppliers and buyers. The court declared the order provisionally enforceable, meaning that the order had an immediate effect, even if one of the parties appeals the ruling.
Royal Dutch Shell has since stated that it plans to appeal the ruling.
Click here to read the English version of the decision.