ExxonMobil blunts activist shareholder in proxy fight
US supermajor ExxonMobil said May 26 shareholders had elected eight of the company’s 12 nominated directors and two of four nominees put forward by activist shareholder Engine No. 1.
Engine No. 1, a hedge fund holding just $54mn of ExxonMobil’s estimated $248bn market capitalisation, has waged a proxy battle with the supermajor since late last year, alleging its focus on fossil fuels over climate change represents an “existential risk” for shareholders.
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Vote results for five additional nominees – four of ExxonMobil’s candidates and one of the remaining two Engine No. 1 nominees – were too close to call. The fourth Engine No. 1 nominee, former Vestas Wind Systems CEO Anders Runevad, was not elected.
“We welcome all of our new directors and look forward to working with them constructively and collectively on behalf of all shareholders,” ExxonMobil chair and CEO Darren Woods said. “We’ve been actively engaging with shareholders and received positive feedback and support, particularly for our announcements relating to low-carbon solutions and progress in efforts to reduce costs and improve earnings. We heard from shareholders today about their desire to further these efforts, and we are well positioned to respond.”
Andrew Logan, senior director for oil and gas at Ceres, which co-ordinates investor climate action, told the Financial Times (FT) the election of the two Engine No. 1 nominees represented a “landmark” event for ExxonMobil and the industry that would “accelerate needed change” in the oil and gas sector.
“Nothing focuses a director’s mind like the possibility that they might lose their job,” he told FT. “Today that risk became very real.”
In addition to Woods, shareholders at ExxonMobil’s May 26 virtual annual general meeting re-elected Michael Angelakis, Susan Avery, Angela Braly, Ursula Burns, Kenneth Frazier, Joseph Hooley and Jeffrey Ubben to the board. Gregory Goff, former CEO of refiner and marketer Adeavor, and Kaisa Hietala, former executive vice president of renewables at Finnish refiner Neste, were the two Engine No. 1 candidates elected.
Still undetermined are the voting results for ExxonMobil’s remaining candidates – Steven Kandarian, Douglas Oberhelman, Samuel Palmisano and Wan Zulkiflee – and the fourth Engine No. 1 candidate, Alexander Karsner, senior strategist at X (formerly Google X), the innovation lab of Alphabet Inc., which owns Google.