A stinging defeat for Chairman and CEO Darren Woods
Darren Woods, Chairman and CEO of Exxon Mobil Darren Woods (Brendan Mcdermid/Reuters)
By Steven Mufson, Washington Post
ExxonMobil shareholders voted Wednesday to install at least two new independent directors to the company’s board, a resounding defeat for chief executive Darren Woods and ratification of shareholders’ unhappiness with the way the company had been addressing climate change and its lagging financial performance.
Woods tried to muster votes until the last minute, but failed to win backing for all of his proposed directors. In addition to the election of two new independent directors, the votes over two others from the dissident slate were too close to call. Both sides spent tens of millions of dollars on the hard-fought campaign.
At one point, ExxonMobil declared a one-hour recess in the annual meeting, a move many believed reflected ongoing negotiations over votes. “Stopping the vote was a pretty desperate move and usually portends a result the establishment does not want to happen,” said a former oil refining executive with experience at annual meetings.
The proxy campaign that rocked the 130-year-old oil behemoth was led by a young, relatively small hedge fund called Engine No. 1. But it quickly won the backing of the three biggest U.S. pension funds, the two biggest advisory services, and the three biggest fund managers. The three fund managers — BlackRock, Vanguard and State Street — hold more than 20 percent of the ExxonMobil’s shares.
Related news:
Climate Activists Defeat Exxon in Push for Clean Energy (New York Times)
Activist Wins Board Seats After Questioning Oil Giant’s Climate Strategy (WSJ)
“Investors are waking up,” Anne Simpson, managing investment director for board governance and sustainability at the California Public Employees’ Retirement System, said in the run-up to the vote. “The sleeping giant maybe is stirring.”
Chevron investors also flexed their muscle on Wednesday, casting 61 percent of shares in favor of a proposal asking the oil major to cut its total greenhouse gas emissions, including customers’ emissions, a category known as “Scope 3” in addition to its own operations and supply chains. Shareholders voted 61 percent in favor of the proposal, according to a preliminary count announced by Chevron at its annual general meeting.
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