Exxon shareholders launch proxy fight against the oil giant's directors

A group of Exxon Mobil shareholders launched a proxy fight against the oil giant’s directors after failing to get a climate proposal onto the ballot for the company’s annual meeting. The New York State Common Retirement Fund, led by New York State Comptroller Thomas DiNapoli, and the Church of England, said they would vote against all Exxon directors at the company’s May 29 annual meeting and urged other shareholders to consider doing the same.

Exxon’s “inadequate response to climate change constitutes a serious failure of corporate governance,” they said in a filing on Friday. Scott Silvestri, an Exxon spokesman, pointed to the company’s proxy statement, where the board recommended shareholders vote against the investor proposals. In the proxy filing, the firm said its full board holds at least one session each year dedicated to climate issues.

The shareholders said they have engaged with Exxon on climate change and its greenhouse gas emissions since 2005 and the company has “failed to respond adequately” in contrast to peers such as BP, Chevron, Royal Dutch Shell and Total SA.

New York State’s pension fund, which holds about 10 million shares of Exxon, has faced pressure from state lawmakers and New York Governor Andrew Cuomo to divest its holdings of Exxon and other fossil fuel companies. DiNapoli has resisted, saying he would prefer to engage with the firm due to its economic importance.

The New York fund and the Church of England in 2017 led a climate shareholder proposal at Exxon, backed by more than two-thirds of shareholders and required the firm to produce a report on how climate change affects its business. The shareholders were disappointed with the report, so have continued to press the firm to set greenhouse gas reduction targets. Bloomberg

"Exxon’s board’s refusal to adequately address significant shareholder concerns and properly account for climate risk in its operations, even as its competitors do so, presents a governance crisis," DiNapoli said.