A template shareholder resolution that sets out obligations relating to a company's climate change commitments.
Why use this?
A proactive shareholder resolution adapted to a company’s unique business risks and opportunities that allows directors to engage confidently with shareholders on climate change issues and commit to building on existing UK climate change disclosure obligations and general industry guidance.
How to use this clause
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The clauses on this website (and published in our Climate Contract Playbook) have been prepared in good faith on a pro bono basis and are free to download and use. The clauses have been drafted and edited by a variety of lawyers and, as such, the approaches to drafting may not conform to any particular drafting norms. We acknowledge this as a consequence of the collaborative drafting process.
The clauses on this website (and published in our Climate Contract Playbook) are provided on an ‘as is’ basis and without any representation or warranty as to accuracy or that the clauses will achieve the relevant climate goal or any other outcome.
This website (and the Climate Contract Playbook) does not comprise, constitute or provide personal, specific or individual recommendations or advice of any kind, and does not contain legal or financial advice. The clauses are precedents for legal professionals to use, amend and negotiate using their professional skill and judgement and at their own risk.
While care has been taken in the drafting of these clauses, neither The Chancery Lane Project nor any of its contributors owe a duty of care to any party in relation to their preparation and do not accept any liability for any errors or omissions, nor for any loss incurred by any person relying on or using these clauses or any other person. Users should use their own professional judgement in the application of these clauses to any particular circumstance or jurisdiction or seek independent legal advice.
At present, all the clauses are based on the laws of England and Wales. We encourage the conversion of these precedent clauses for use in other jurisdictions.
1. [THAT the [Company’s] [Energy Transition Strategy] [Climate Transition [Action] Plan] [Emissions Reduction Strategy], which [is published on the Company’s website] [can be found [here]*], be approved on a non-binding and advisory basis].
* [Drafting note: A company may have an umbrella strategy covering “sustainability” generally, with net zero emissions being one commitment under this. Alternatively, a company may have a standalone net zero strategy. Companies could consider extending the scope of this beyond greenhouse gas emissions.]
2. THAT the Company:
2.1 [Where a company does not already have a strategy in place] establish and implement short- and medium-term targets to develop [an Energy Transition Strategy] [Climate Transition [Action] Plan] [Emissions Reduction Strategy] that aligns with the goals of the Paris Agreement, in particular pursuing efforts to limit global temperature increase to 1.5 degrees Celsius above pre-industrial levels by [2050 or sooner]. The Company’s short- and medium-term targets shall align with achieving a 45% reduction in emissions from 2010 levels by 2030, and net zero by 2050. The Company shall achieve at least a 7% reduction of greenhouse gas emissions year on year and adopt an offsetting strategy for greenhouse gas emissions it is unable to abate in accordance with the Oxford Principles for Net Zero Aligned Carbon Offsetting.
2.2 report to shareholders on its progress against the [Energy Transition Strategy] [Climate Transition [Action] Plan] [Emissions Reduction Strategy] [annually] in a manner that is consistent with the requirements of the [Task Force on Climate-Related Financial Disclosures / the UK government’s guidance on environmental reporting including streamlined energy and carbon reporting requirements], (the “Net Zero Transition Reporting”), including, for example:
2.2.1 how the Company has evaluated the impact of its [Energy Transition Strategy] [Climate Transition Plan] [Emissions Reduction Strategy] to ensure a just and equitable transition to net zero and consider wider social and ecological goals [provided that the Net Zero Transition Report will omit commercially confidential or sensitive information and will be at reasonable cost]; and
2.2.2 provide shareholders the opportunity to consider and provide feedback on the Net Zero Transition Reporting and any revisions to the [Energy Transition Strategy] [Climate Transition [Action] Plan] [Emissions Reduction Strategy] that the Net Zero Transition Reporting indicates is necessary.]