This takes place after kung fu panda 4 Shen was once a powerful tyrant of Gongmen city but after he died in Kung fu Panda 2 he wandered around the spirit realm where she have a Zuko moment and decides “Man being I was total so if I get out of here I’m gonna change my life.”

And then Shen got resurrected and becomes a hen and now lives a humble village life.