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The Anglo-Dutch company has said the simplification of its dual tax structure is designed to strengthen its competitiveness, accelerate its energy transition plans and help to make distributing profits to shareholders more straightforward.
A final tally of results showed 99.8% of shareholders backed the special resolution, according to Reuters. The motion had required the approval of at least 75% of the votes cast to pass.
The proposal will likely see the company drop the “Royal Dutch” from its name to become “Shell PLC.” A move to London from The Hague is expected sometime early next year.
The verdict marked the first time in history that a company had been legally obliged to align its policies with the Paris Agreement and reflected a watershed moment in the climate battle.
Shell has said its environmental policy would not be affected by the move.
The Dutch government said last month that it had been “unpleasantly surprised” by Shell’s proposal to move its headquarters to the U.K.
Shell’s simplification strategy seeks to establish a single line of shares to scrap the firm’s unusual and complex dual-class share system. The company has been incorporated in the U.K. and had a Dutch tax residence since 2005.
A new single share tax structure and British tax home would mean it no longer has to abide by a 15% withholding tax charged on dividends.
Nick Stansbury, head of climate solutions at Legal and General Investment Management, a top 20 shareholder of Shell, said on Friday that the vote to approve Shell’s plans had no major downsides for investors.
“These changes, they sound like they are enormously important, that they should be very, very controversial, that they going to have really big far-reaching consequences for the company, but we don’t really think that that’s the case,” Stansbury told CNBC’s “Street Signs Europe.”
“We think this is actually a relatively routine bit of corporate simplification, a kind of corporate tidying up exercise to deal with a complex bit of historical legacy that is simply no longer needed in the world that Shell now lives and operates in.”
Stansbury said the oil giant would be able to return capital to shareholders more efficiently if the resolution was approved.
Shares of Shell were 0.8% higher during afternoon deals in London. The oil and gas company has seen its stock price climb roughly 33% year-to-date, having collapsed almost 45% in 2020.
A rebound in profits for oil and gas companies this year has prompted executives to reassure investors that they have gained a much more stable footing following a brutal year by virtually every measure in 2020.
Analysts have warned, however, that while energy companies try to claim a clean bill of health, investors are likely to harbor a “tremendous degree” of skepticism about the business models of fossil fuel companies in the long term.
Read More: Shareholders of oil giant Shell vote in favor of London move