Thursday, May 26, 2016

Rift Emerges over Exxon:  Engage or Divest?

A protester held a splattered Exxon Mobil Corp. sign as shareholders debated resolutions yesterday calling on the oil company to recognize climate change and work on global emissions-cutting goals. (Photo Credit: Mike Lee) Click to Enlarge.
Stockholders at Exxon Mobil Corp., the world's largest private-sector oil company, passed a proposal yesterday to nominate outside candidates to the board, a move that could affect the company's decisions on climate change.

New York City Comptroller Scott Stringer, the fiduciary for New York city's five public pension funds, which invests about $150 billion, filed the proxy access resolution, which received 62 percent support.

The nonbinding resolution is the first measure opposed by Exxon's board to pass since 2006, according to Stringer's office.  It allows investors who hold 3 percent or more of company stock for at least three years to nominate directors; similar resolutions have passed at dozens of other companies.

"If this company is to properly address fundamental long-term risks like climate change, its board of directors must be diverse, independent and accountable," Stringer said in a statement.

The vote touched off a debate among activists about the best way to get Exxon to change its approach to climate risks in the wake of last year's revelations that the company may have suppressed evidence on climate science.

Investors like the California Public Employees' Retirement System (CalPERS), the country's largest, have taken an incremental approach.  Rep. Ted Lieu (D-Calif.) -- along with many of the 60 to 70 protesters who picketed the meeting -- wants pension funds to divest from Exxon, and some critics want to see Exxon face civil or criminal penalties.

Exxon faced 11 shareholder resolutions at yesterday's annual meeting.  The majority related to climate change and Exxon's business plans to address climate change and greenhouse gas regulations.  All but the proxy access resolution were defeated.

Read more at Rift Emerges over Exxon: Engage or Divest?

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