Exxon's Gamble: 25 Years of Rejecting Shareholder Concerns on Climate Change

Refusing to act on climate resolutions could become a costly mistake, and invite the kind of legal onslaught that cost tobacco companies billions of dollars.

For a quarter-century, stockholders have asked Exxon to confront the threat of climate change in all sorts of ways:  by investing in renewable energy, cutting harmful emissions, providing carbon risk assessments and adding a board member with climate expertise.  Year after year, the oil giant has said no, rejecting shareholders’ requests and downplaying their concerns long after scientists concluded that unfettered burning of fossil fuels is leading to catastrophic climate change.  At Chevron and ConocoPhillips, executives have also routinely opposed climate-related shareholder resolutions. 

But Exxon, the biggest and richest of the oil giants, is also the most dug-in.  Late last month, it fought off another shareholder request to adopt one of the most basic and widely endorsed climate policies in corporate America—to set company-wide goals to lower greenhouse gas emissions.  It’s a proposal Exxon investors have introduced at annual meetings on and off since 1990, and it continues to hit the same wall. 

“We have been ringing alarm bells for years saying to the oil companies that the status quo is unsustainable, is dangerous for investors, and in the long term isn’t in the companies’ best interests,” said Timothy Smith, shareholder engagement director at Boston-based Walden Asset Management, a 40-year-old investment firm managing $3 billion in assets.  “They’re aware of the trends, but that doesn’t mean they’re changing their business plans.  They’re not convinced they should move away from [the oil] business, or even curtail it.”

Read more at Exxon's Gamble:  25 Years of Rejecting Shareholder Concerns on Climate Change