LONDON ― Royal Dutch Shell caved in to growing investor pressure over climate change on Monday, setting out plans to introduce industry-leading carbon emissions targets linked to executive pay.

Rivals BP and Total have already set short-term targets on reducing carbon dioxide emissions, but these are limited to their own operations.

Shell’s targets, which will be introduced in 2020, will be more extensive with inclusion of the so-called Scope 3 emissions from the burning of fuels sold to millions of customers around the world, the company said.

Monday’s move marks a change of tack for Shell Chief Executive Ben van Beurden, who had previously resisted setting hard goals, saying it would be “foolhardy” to expose Shell to legal challenges.

Shareholders have criticized Shell for previously setting long-term “ambitions” to halve carbon dioxide emissions by 2050, which lacked binding targets for implementation.

But after discussions with investors, the Anglo-Dutch oil and gas giant said that from 2020 it will […]