Shareholder advocacy group As You Sow has issued a detailed response to Exxon Mobil’s opposition to its request for a report on the risks of hydraulic fracturing (“Fracking”) in natural gas drilling.
It comes ahead of the company’s annual meeting in Florida on May 30 at which As You Sow has tabled a shareholder proposal on the issue on behalf of the Park Foundation and others.
San Francisco-based As You Sow says Exxon’s disclosures on fracking do not communicate the scope of opposition nor the financial implications for shareholders.
“Investors need more information to determine how companies are managing the community impacts along with the impact such opposition has had on its operations now and into the future,” As You Sow says.
It added: “ExxonMobil’s history of violations demonstrate that things can and do go wrong. As a result, we encourage shareholders to vote in support of this proposal.”
The 37-page letter includes detailed appendices on public opposition to Exxon’s fracking operations and on the environmental, social and health impacts – including water contamination, air quality and earthquake risk among others.
It comes as a group of 55 major global investment institutions – with almost $1trn (€786m) in combined assets under management – have united to support a set of 12 best practice guidelines covering fracking.
The company is advising shareholders to vote against the motion, saying it is committed to operating in an environmentally responsible manner.The company had tried to get approval from the Securities and Exchange Commission to omit the proposal from the proxy ballot on the grounds that it was substantially implemented. But the SEC rejected this – saying Exxon’s public disclosures did not compare favorably with the As You Sow proposal.
Including the As You Sow motion, there are a total of six shareholder proposals on the proxy ballot.
They cover independent chairman (proposed by Ram Trust Services), majority vote for directors (United Brotherhood of Carpenters Pension Fund), political contributions (Laborers National Pension Fund), equal employment opportunities policy (New York State Common Retirement Fund) and greenhouse gas emissions (Sisters of St. Dominic). The company is resisting all of the resolutions.
Exxon gained SEC approval to omit proposals on the human right to water (Northstar Asset Management) and oil sands risks (Green Century Capital Management and Trillium Asset Management).
A group of faith investors led by the Province of St. Joseph of the Capuchin Order withdrew their proposal calling for a ‘Climate Future Task Force’ after dialogue with the company.
Founded in 1992, As You Sow promotes environmental and social corporate responsibility through shareholder advocacy, coalition building, and innovative legal strategies. Earlier this week, it said shareholders had put Duke Energy, FirstEnergy and Ameren under scrutiny over their reliance on coal. Its resolutions at the companies gained 12%, 11% and 10.5% respectively.