Shareholder campaign on greening oil and gas suspended for a year

Climate campaign group Follow This has decided it would not land enough support to justify filing shareholder resolutions at oil and gas firms this year.

The Dutch body, which uses the proxy voting process to ask fossil fuel companies to decarbonise, has announced it would take a year off – the first time since it started in 2016 – amid the growing pushback against ESG.

The campaign peaked in 2021, when resolutions filed by Follow This at ConocoPhillips and Phillips 66 received the backing of the majority of the firms’ shareholders.

In the four years since then, support for similar proposals has averaged around 20%.

But Follow This founder Mark van Baal said an increase in support was necessary for the requests to be effective.

“We knew we would get another 20% support this year, but another 20% for the fourth year in a row isn’t useful,” he told IPE.

Companies have historically taken the climate requests seriously only when there is a clear uptick in investors endorsing them at the ballot, he continued.

“So we’ve decided to spend our time speaking with investors – those that have supported us in the past, and those that haven’t supported us – to try to get a clearer understanding of how we grow that 20% for next year.”

Van Baal said it was trickier to get shareholders to vote in favour of Follow This’s climate resolutions in 2025, because of a clampdown on both sustainability and shareholder rights in the US.

Politicians in some states have been taking legal action against asset managers that pursue environmental or social objectives, while others have banned pension funds from divesting fossil fuels and blacklisted managers with similar policies.

Exxon tried to sue activists including Follow This last year over their use of shareholder proposals as a tool to influence the environmental credentials of the company.

More recently, the Securities and Exchange Commission has abandoned its climate disclosure rules, and is taking a tougher stance on which resolutions can make it to vote at companies.

Delaware, where most US firms are listed, has recently agreed to give more power to management boards at the expense of shareholders’ rights, and there are efforts to prevent investors with more than 5% of a company from exerting influence over corporate strategy.

That has made many financial institutions wary of engaging in stewardship and voting activities in 2025.

At the same time, and after a period of unsuccessful engagement, a number of major European asset owners with net zero commitments have given up on the idea that fossil fuel companies will transition to a low-carbon economy.

Allianz, the Church of England Pensions Board and PGGM are among those to have consequently exited the oil and gas sector in recent years.

That means they can no longer throw their weight behind climate resolutions being tabled at those firms.

“Divestment doesn’t work,” argued van Baal. “And engagement doesn’t work either. And nor do resolutions that focus on getting more disclosures from oil majors.”

“What works is asking for climate action, and that’s what we’ve been doing with our resolutions.”

He said he expected to return to filing proposals in 2026, and will also explore other mechanisms to mobilise investors and influence companies.

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