Shell’s Heroic U-Turn Away from Carbon Offsets: Putting Profits Over Planet

Posted by John Donovan 1 Sept 2023

Bravo, Shell! Six months after Wael Sawan stepped into the captain’s chair as the CEO, he made a groundbreaking decision to quietly sunset that pesky carbon offset initiative, the world’s biggest corporate plan of its kind. Because why save the planet when you can save a dime? At an all-day investor gala (don’t you just love those?), Sawan somehow “forgot” to mention the company’s previous aim to cough up US$100 million a year for carbon credits. Oopsie-doodle!

This strategic “oversight” follows a scintillating pattern, as Shell also discarded their grand plan to amass a staggering 120 million carbon credits a year by the end of this decade. That would’ve covered a measly 10% of their emissions. No new targets? No worries, Shell has retired its ambition to be a climate leader faster than one of its offshore oil rigs.

The company’s pulling back on carbon offsets also reveals the courage to admit the unattainable: they barely made a dent in their own goals. They spent only US$95 million, just about half of their initial “commitment.” How did they manage to blow so much money and accomplish so little? By investing in projects from Western Africa to the Brazilian Amazon to Australian farmlands, of course. Projects that Shell insisted met its “quality standards,” although those projects generated “few if any offsets.” 

Flora Ji, who’s run Shell’s “nature-based solutions” since 2021, graciously told us beforehand that, “It didn’t have that kind of huge, exponential growth we expected.” No kidding! Turns out those lofty climate goals were just for show. 

Now, Shell still dares to maintain that “the increase in demand for carbon credits should be matched by the need for quality.” Bless their hearts, they’re still focused on quality over quantity, especially when it comes to excuses.

The company’s old carbon projects? They were a mere “dangerous scam” according to some critics, but Shell tried to do it the “right” way. They took a conservative approach to estimated deforestation, evaluated long-term management, and ensured fair revenue sharing. But alas, who has time for such trivial matters when there are profits to be made?

CEO Sawan has indeed softened some of his predecessor’s burdensome environmental priorities. Shell’s latest environmental vision includes not just scrapping carbon offset goals, but also sidelining investments in renewable energy and silently abandoning EV charge point and clean hydrogen sales targets. It’s like a hit parade of “not gonna happen.”

Adam Matthews, chief responsible investment officer at the Church of England Pensions Board, sums it up best: “They’re no longer aligned with trying to navigate the transition in the same way that we had previously perceived.” Perhaps they were never aligned to begin with.

So here’s to Shell—continuing to redefine ‘corporate responsibility’ in a way that only they can. Remember, Shell’s sustainability and climate targets still “remain,” according to a company spokesman. They just forgot to tell us what those are now. Cheers to opacity and profit!

Shell and any other party are invited to correct us if we’re wrong. But when you’re this committed to not committing, what’s there to correct?