Royal Dutch Shell PLC is recommending that its investors approve a resolution on climate change, an unusual step for an oil and gas giant whose business model depends on burning fossil fuels. The measure requires Shell to disclose the risks that the company could face if global leaders act to reduce harmful greenhouse gas emissions.

“The board has given consideration to the resolution and has decided to recommend that shareholders support the resolution” at the Annual General Meeting in May, JJ Traynor, Shell’s executive vice president of investor relations, said in a letter to shareholders Tuesday.

Climate-conscious investors said Shell’s decision could be “transformational” in terms of getting other major oil and gas companies to address their climate risks. “I think it’s going to make it harder for other companies to take a less-than-cooperative approach,” Andrew Logan, director of oil and gas and insurance program at Ceres, a U.S.-based investor advocacy group, said on a conference call Tuesday. “It’s a real validation that these concerns are important and deserve attention and transparency from the [energy] industry.”

The Shell shareholder resolution was filed last year by the Aiming for A Coalition, a group of around 50 British investors and pension funds, including the CCLA Investment Management, the investor arm for the Church of England. The coalition has filed a similar resolution with oil company BP PLC.

The shareholder measure calls for Shell to include in its annual reporting a more detailed analysis of how its business model would fare in a low-carbon future and project how carbon emissions policies could affect its incentive and bonus structures and capital flows, Helen Wildsmith, CCLA’s head of ethical and responsible investment, said on the call. The resolution also requires Shell to disclose how it is managing its own greenhouse gas emissions and what it’s doing to influence the public policy process.

“This [resolution] is very reflective of the fact that a lot of institutional investors globally are looking at the carbon risk of their portfolios and asking for more disclosure,” Wildsmith said. “A lot of shareholder [activist] resolutions that get filed are ahead of their time, whereas this one … is of its time.”

Shell’s letter comes on the same day that the Netherlands-based company said it will slash spending by more than $15 billion in the next three years as falling oil prices eat away at its revenues. The company’s announcement follows similar news from BP, which said Monday that it would freeze the wages of its 80,000 workers and sell down its stake in two large fields in the Gulf of Mexico.