Shell taps new CEO amid transition push
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Illustration: Annelise Capossela/Axios
Shell CEO Ben van Beurden will step down at year's end after nine years that included new climate initiatives and weathering the shock of the COVID pandemic.
Why it matters: Wael Sawan, currently head of Shell's integrated gas, renewables and energy solutions unit, will replace van Beurden as CEO of one of the world's most powerful energy companies.
- Alongside other European-based giants, Shell is diversifying into more climate-friendly business lines like EV charging and offshore wind, but also facing criticism that it's moving too slowly.
Catch up fast: Van Beurden became CEO in early 2014 and has been with the company for almost 40 years.
- "The first big move of his tenure as CEO...was the takeover of rival BG Group Plc, a deal valued at close to $50 billion that tested the company’s finances during an oil price slump, but is now paying off as natural gas prices soar," Bloomberg notes.
What we're watching: Follow This, a climate-focused shareholder advocacy group, offered a mix of praise and criticism of van Beurden as it signaled upcoming pressure campaigns on the new boss.
- Oil majors are hauling in huge profits amid high commodity costs, while demand looks set to remain robust for the foreseeable future.
- But Follow This warns that Sawan "has to make bold decisions to explore new business models instead of new oil and gas. If he fails to deliver deep emissions cuts, he puts the company at great financial risk."
Yes, but: Per the Financial Times, RBC Capital Markets analyst Biraj Borkhataria does not expect a major change in the company's posture with van Beurden's departure.
- “The shift is likely to be more of a continuation than revolution of the strategy put in place by van Beurden," Borkhataria said.
Sawan's elevation was "well anticipated," JPMorgan Chase & Co. analyst Christyan Malek said in a note reported by Bloomberg. “We expect him to maintain Shell’s pragmatic and holistic approach to the energy transition," Malek said.
