Later today, we will hear President Trump announce from the Rose Garden about whether the US will pull out of the Paris climate accord. Meanwhile, ExxonMobil shareholders have stated that they do care about climate change.
As an ExxonMobil shareholder, I see that the firm is the frequent subject of activist shareholder items. There were nine such items on the agenda for the meeting yesterday.
Preliminary results of the vote on Wednesday had 62.3 percent in favor of the climate change proposal, up from the 38 percent who voted in favor of a similar resolution last year.
“RESOLVED: Shareholders request that, beginning in 2018, ExxonMobil publish an annual assessment of the long-term portfolio impacts of technological advances and global climate change policies, at reasonable cost and omitting proprietary information. The assessment can be incorporated into existing reporting and should analyze the impacts on ExxonMobil’s oil and gas reserves and resources under a scenario in which reduction in demand results from carbon restrictions and related rules or commitments adopted by governments consistent with the globally agreed upon 2 degree target. This reporting should assess the resilience of the company’s full portfolio of reserves and resources through 2040 and beyond, and address the financial risks associated with such a scenario.
The company’s board of directors has recommended a “no” vote.
ExxonMobil recognizes the dual challenge of meeting the world’s growing energy demand to support the economic growth needed for improved living standards, while simultaneously addressing the risks posed by climate change. In this regard, we believe the risks of climate change are serious and warrant thoughtful action.
It’s thoughtful action is just different than the shareholder proposal. ExxonMobil supports the Paris accord that President Trump appears to be ready to reject. (Why hold a Rose Garden conference to say you’re not changing?) ExxonMobil has also stated that it supports a carbon tax.
The New York State Common Retirement Fund (one of my firm’s investors) was the lead proponent of the resolution. Patrick Doherty, director of corporate governance for the New York State Office of the State Comptroller, which runs the New York State Common Retirement Fund stated: “We have a very, very strong financial interest in the long-term health of the company.”
Sources:
- Notice of 2017 Annual Meeting and Proxy Statement for ExxonMobil
- Financial firms lead shareholder rebellion against ExxonMobil climate change policies by Steven Mufson in the Washington Post
- Shareholder Proposals: Climate Change Approved at ExxonMobil! by Liz Dunshee in Corporate Counsel .net
- Exxon Mobil Shareholders Demand Accounting of Climate Change Policy Risks by Diane Cardwell in the New York Times