A Dutch court’s demand that Royal Dutch Shell PLC slash carbon emissions is casting a spotlight on how investors approach oil companies and their strategies to manage climate risks.
In one particular corner of the market—bonds issued by oil companies including Shell—investors appear to be juggling their holdings to get ahead of possible changes.
The development of climate change as a factor for investors to consider is shaking the investment world. The Dutch court ruled on Wednesday that Shell must cut its emissions by 45% by 2030, a move that amps up the pressure to decarbonize. Shell said it plans to appeal.
On the same day, Exxon Mobil Corp. shareholders elected board members nominated by an activist investor that wants the oil giant to prepare for a post-fossil-fuel world.
Those decisions echo forces already creating new dynamics in how investors look at fossil-fuel companies.