The company has been thinking about exiting for some time. The lack of a dividend tax write-off may have played a role in the decision. This abolition was promised by Rutte’s third cabinet, but was withdrawn due to pressure from the House of Representatives. This previously led to the departure of Unilever’s head office from the Netherlands.
Shell itself stated that it was the dual share structure that caused the company to operate more slowly than expected. Shell shares are listed on the London and Amsterdam stock exchanges. According to Shell, the move does not change its activities in the Netherlands. The group wants to convey these intentions to shareholders on December 10.
In addition to CEO Ben van Beurden and CFO Jessica Uhl, around ten members of senior management will travel to London. Shell stated that global renewable energy management will continue to be carried out starting from The Hague and Amsterdam. The group wants to change its name from Royal Shell to just Shell. Its shares will also continue to be listed on the Amsterdam stock exchange, according to Andrew Mackenzie, chairman of Shell’s board of directors since this year.
Dutch
CEO Van Beurden promised that the energy group would remain closely connected to the Netherlands. “I want to emphasize that simplifying our structure is necessary to accelerate our strategy. This way we can play a leading role in the energy transition.”
The new cabinet was informed of the move on Sunday evening and said it was ‘very surprising’, according to outgoing Economic Affairs Minister Stef Blok. The government said it was in discussions with the group’s management about the possible impact on employment, investment decisions and sustainability.
“This remains a difficult message,” a spokesperson said. “But by ending the current complex sharing structure, we can operate faster and better in implementing the energy transition.”
According to a spokesman, the move was ‘in no way’ taken to avoid a Hague court ruling last spring, which required Shell to drastically reduce CO2 emissions. “This lawsuit does not depend on our decision. We will obey what the judge orders us to do.’
Environmental Defense
Milieudefensie, which filed and won the climate case against Shell, said Shell’s departure had no consequences. “The matter is still before the Dutch courts,” a spokesman said.
If, after a possible appeal, the case ends up in the European Court of Justice, Shell would still not be able to avoid the ruling, as the UK is also bound by the ruling of the European Court of Human Rights after Brexit, according to Milieudefensie.
“We also don’t think there will be any consequences to future climate cases. Companies around the world have an obligation to prevent climate change. That doesn’t change with his departure,” said a spokesperson for the environmental organization.
Recent calls from hedge fund Third Point for Shell to be split into a traditional oil and gas extraction company and a company focused on sustainable energy did not factor into the decision to exit. The recent announcement by pension fund ABP to withdraw as a Shell shareholder is also separate from that decision, the spokesman said. “Such decisions require enormous preparation. You can’t do that in a few weeks.’
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