Royal Dutch Shell plans to move its headquarters to Britain, simplify its share structure and change its name as part of an overhaul that executives say will better position the oil and gas giant’s transition to a cleaner energy business.
In the plan announced Monday, Shell would move its tax residence from the Netherlands to the United Kingdom, which has a substantially lower corporate tax rate, and free it from a dividend tax that many investors saw as onerous. It also would erase “Royal Dutch” from its name and become Shell Plc.
The Washington Post report that the moves come as the energy giant, and the world at large, is under growing pressure to reduce its carbon footprint. In May, a Dutch court ordered Shell to slash greenhouse gas emissions at a significantly faster pace than planned.
“At a time of unprecedented change for the industry, it’s even more important that we have an increased ability to accelerate the transition to a lower-carbon global energy system,” board chairman Andrew MacKenzie said in a statement. “A simpler structure will enable Shell to speed up the delivery of its Powering Progress strategy, while creating value for our shareholders, customers and wider society.”
Investors seemed to embrace the plan, sending Shell’s shares up about 2.5 percent in Monday trading.
But the Dutch government was “unpleasantly surprised,” according to a tweet by the Ministry of Economic Affairs and Climate Policy, prompting a scramble from some policymakers to try to change company officials’ mind.
The blueprint, which is subject to shareholder approval, would end the framework that made Shell a child of both nations. The oil giant traces its corporate roots to 19th-century England, when a small London-based import-export business began hiring steamers to carry oil through the Suez Canal and elsewhere. To better compete with Standard Oil of the United States, it merged with a Dutch rival to create the Royal Dutch Shell Group in 1907.
Shell is under court order to bring greenhouse gas emissions 45 percent lower than 2019 levels by 2030 in alignment with the Paris climate accord. While the company has said it would appeal, the issue comes with growing urgency. World leaders at the recently ended COP26 summit in Glasgow, Scotland, came to an agreement meant to strengthen near-term climate targets and move the planet away from fossil fuels more quickly.
