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March 21, 2000
Greenpeace Takes On New Role as Royal Dutch/Shell Shareholder
The environmental organization renowned for attention-getting activism buys Shell shares to urge
the company toward solar production.
SocialFunds.com --
Five years ago, Greenpeace activists boarded an abandoned North Sea oil platform, and refused to
budge until Shell scratched plans to ditch the structure at sea. They succeeded. But times have
changed, and now Greenpeace activists will confront the oil giant on their own ground, as a
shareholder in the annual meeting on May 9.
Last week, Greenpeace announced that they
had bought 4,400 shares of Royal Dutch/Shell for 500,000 Dutch Guilders, or 250,000 Euros if you
will. They are now entitled to take advantage of a new directive at the Amsterdam Stock Exchange
(AEX), which provides for the circulation of proposals to all major shareholders, to garner support
for a proposed solar panel factory.
 "Working from within the share structure of
publicly owned multinational companies is one way to effectively influence their corporate agendas
to include environmental objectives," said Jon Walter, a Greenpeace spokesperson. "This type of
activism has been used successfully in the U.S., but is relatively new in Europe."
Greenpeace is proposing that Shell build a factory that would produce 5 million photovoltaic
solar panels a year, enough to equip 250,000 homes each with a two-kilowatt system. Their objective
is to advocate the solar factory as a profitable investment that would lower unit costs and make
solar panels competitive with conventionally produced electricity from burning fossil fuels.
To drum up support for the proposal, Greenpeace commissioned a research report from the
business consulting and accountancy firm, KPMG, called "Solar Energy: from Perennial Promise to
Competitive Alternative." The KPMG report calculates that one solar factory on the scale proposed
could reduce the cost of solar power by a factor of four, making its price competitive with
electricity produced from conventional sources.
The KPMG report also estimates a 15
percent return on investment in the solar factory, more than the average profit of Shell's activity
in oil and gas. The report suggests that although the solar power could be profitable in the short
term, it would also be a sound long-term investment as oil and gas are eventually phased out for
environmental and supply concerns.
Greenpeace's Shell resolution follows a similar
shareholder motion put to BP-Amoco by a group of 100 British and American shareholders, led by
Greenpeace, Trillium Asset Management, and U.S. Public Interest Group. Collectively holding more
than 150,000 shares, the group is asking the oil company to halt plans to explore the Arctic
National Wildlife Refuge, and divert that capital toward expanding solar manufacturing capacity.
The environmental group's shareholder activities not only signal a change for activists
fond of shackling themselves to nuclear plants or intercepting toxic waste on the high seas, but a
change in the arena of shareholder advocacy. The growing accessibility and significance of social
and environmental shareholder actions may in the end bring other similarly aligned groups into the
process of seeking corporate environmental responsiblity120.
"Some environmental groups
may be encouraged to use a similar tactic if this campaign by Greenpeace is successful and has some
tangible influence on the company's operations," said Walter. "Longer term, it could lead to
greater accountability and more genuine movement to incorporate environmental and social objectives
into company operations, rather than simply including them as subheadings in glossy annual
reports."
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