Investors gave unprecedented voting support for climate ‘stress-test’ resolutions filed by shareholders at the ExxonMobil and Chevron annual meetings yesterday. The resolutions, requesting that the companies stress test their business strategies against a scenario where climate change is limited to 2 degrees Celsius or less (the goal of the global climate agreement forged in Paris), received 38.2% shareholder support at the ExxonMobil meeting and 41% at the Chevron meeting, respectively.
Edward Mason, Head of Responsible Investment for the Church Commissioners (co-filer at Exxon): “Considering the scale of this vote, we urge Exxon to sit down urgently with its investors to agree the reporting it will provide on the risk that climate change policy poses to its business.”
Peter Grannis, First Deputy New York State Comptroller (co-filer at Exxon): “Exxon needs to explain how it can adjust its business to meet the global effort to reduce fossil fuel consumption. Investors need to know that Exxon is taking steps to protect its long-term value.”
David Zellner, Chief Investment Officer, Wespath (co-filer at Chevron): “Our resolution asks Chevron to conduct “stress tests” on its business of plausible scenarios resulting from shifting demand for fossil fuels and the impact of carbon taxes. As investors, we need assurance that Chevron is strategically positioned for the transition to a low-carbon economy.”
Paul Simpson, Chief Executive, CDP: “We congratulate the institutional investors – many of whom are CDP investor signatories – that spearheaded this resolution. They have put out the message loud and clear: Climate change poses clear financial risks, and investors require better disclosure to be able to price those risks.
“Now the ball is firmly in ExxonMobil’s court – the time has come for it to redefine its role in the global energy transition.”Andrew Logan, Oil and Gas Program Director at Ceres: “Today’s strong votes at Exxon and Chevron send a powerful message that investors see climate change as a material financial risk, which underscores the ongoing momentum post-Paris and urgency to prepare for a low-carbon transition.
“Given the significant resources Exxon spent fighting this proposal, such a strong vote is a real rebuke to company management. Investors have sent a clear message that meaningful 2 degree stress testing is the new norm for risk reporting, and companies like Exxon and Chevron can no longer act as if nothing has changed.
“Moving forward, investors expect Exxon and Chevron to come to the table and collaborate to prepare meaningful disclosures to assess the risks and opportunities presented by the energy transition.”
James Leaton, Research Director at Carbon Tracker: “More of Exxon’s shareholders than ever decided to override board recommendations and demand 2˚C stress-testing. The rest of the world is considering meeting the climate target; Exxon should join them by reporting on how its business model is impacted by that goal.”
Julian Poulter, CEO, Asset Owners Disclosure Project: “This is the beginning of the end for Exxon’s oil based strategy. Many of the world’s biggest investors have sent a clear message to Big Oil that they want a 2 degree business plan that shows how companies will deliver shareholder value in the transition to a low-carbon economy. The board must listen and take action or lose the confidence of shareholders.”
Catherine Howarth, Chief Executive, ShareAction: “This vote demonstrates that the tide is turning on big oil; in order to retain the trust of shareholders and the public alike, Exxon must urgently adjust its business model for a low carbon future.”
Liz McDowell, Campaigns Director, SumOfUs: “More than 15,000 of our members contacted their funds to ask them to vote in favour of these resolutions, showing that they’ve struck a nerve.”