Exxon Mobil has written to its shareholders about the resolution filed by shareholders following comments by investors it says “incorrectly characterize” its position in a sign that the ‘proxy fight’ between the company and its investors over climate change is heating up ahead of its annual meeting at the end of the month.
It is in direct response to the proposal (Item 12 on the ballot) that was filed by the New York State Common Retirement Fund and others (see separate op-ed from Edward Mason of co-filer the Church Commissioners’ here).
The oil major says it supports the Paris Agreement and points to its new Energy & Carbon Summary (ECS) which was distributed this year along with other Proxy Statement materials. It says it is mitigating greenhouse gas emissions in its operations and “delivering solutions” that help customers reduce their own emissions and improve their energy efficiency.
It also says it is supporting research that can “assist society in transitioning to lower carbon energy solutions as well as participating in constructive dialogue on policy options to meet the world’s growing energy needs while addressing the risks posed by climate change.
“We maintain a proactive engagement approach with shareholders to discuss the company’s efforts in addressing the risks of climate change,” it says – adding it has met with the New York State pension funds, the Church of England and other co-filers.
The resistance comes as it has emerged that a huge 67% of investors backed Wespath Investment Management’s climate change impact resolution at Occidental Petroleum last week. Wespath CIO Dave Zellner called it a “sea change in how investors are addressing the transition to a low-carbon economy”.
The Exxon AGM is also the launchpad for the 50-50 Climate Project, a new group including figures like Nell Minow, Laura Berry and William Patterson, that is campaigning for climate competent boards. It has attacked Exxon’s policy of forbidding direct shareholder-director interaction, saying it “shunts off a critical avenue for constructive dialogue on investor concerns”.
Meanwhile, the Church of England, whose investment arm is co-filer of the Exxon resolution, has faced calls from non-governmental organization Christian Aid to divest from fossil fuels, according to a report in the Church Times.
It comes after Archbishop of Canterbury Justin Welby was involved in the decision by BMO Global Asset Management’s range of responsible funds to exit fossil fuel companies.The paper quoted the charity’s head of advocacy Tom Viita as saying: “When a major private company drops its fossil-fuel investments for ethical reasons, one must ask whether the Church of England’s policy is keeping pace.”
A spokesperson for the Church Commissioners referred the paper to an earlier letter from the Church of England’s Pension Board explaining why engagement is preferable to divestment.
Bernadette Kenny, CEO of the Church of England Pensions Board, explained in the letter: “Although the Pensions Board, with the other National Investing Bodies, disinvested from the most polluting fossil-fuel companies, those that generated more than 10% of their revenue from thermal coal and tar sands, we also committed ourselves to playing our part in supporting the transition to a low-carbon economy by engaging with companies and policy-makers.”
She described the launch of its Transition Pathway Initiative (TPI) with the London School of Economics’ Grantham Research Institute, which evaluates corporate practices and performance on climate change, as providing a structured framework for engagement and escalation.
Kenny said: “At the launch of TPI, we gained the support of asset-owners and fund-managers from around the world, with more than £2 trillion in funds under management. This is considerably greater than the £2 billion we manage on the behalf of beneficiaries, and indicates the leadership that the Church as an investor can play in the market.”
She argues that corporate engagement “is too powerful a tool to be rendered ineffective by disinvesting at this time”.
In total there are nine shareholder resolutions at the Exxon AGM in Dallas on May 31:
• Independent Chairman (filer: Ellen M. Higgins Trust)
• Majority Vote for Directors (Southwest Carpenters Pension Fund)
• Special Shareholder Meetings (Kenneth Steiner)
• Restrict Precatory Proposals [“nuisance shareholders”] (Steven J. Milloy)
• Report on Compensation for Women (Eve S. Sprunt)
• Report on Lobbying (United Steelworkers)
• Increase Capital Distributions in Lieu of Investment (Arjuna Capital/Baldwin Brothers)
• Report on Impacts of Climate Change Policies (New York State Common Retirement Fund et al)
• Report on Methane Emissions (As You Sow)