ExxonMobil’s Shareholders Revolt Over Handling of Climate Change
It’s common knowledge that numerous justice agencies, as well as the portion of the general public that stays abreast of these matters, is not at all happy with ExxonMobil. In particular, we have litigation coming down on the oil giant based on its conspiracy to deceive the investment community as to the massively negative impacts that climate change would have on its financial well-being.
What’s not at all common knowledge is that the company’s executive team is under challenge from a large group of its own shareholders. From the article in Bloomberg:
A group of Exxon Mobil Corp. shareholders launched a proxy fight against the oil giant’s directors after failing to get a climate proposal onto the ballot for the company’s annual meeting. Exxon’s “inadequate response to climate change constitutes a serious failure of corporate governance,” they said in a filing Friday. The investors, which said they are acting with the Climate Action 100+ group of investors who oversee $32 trillion in assets, also urged shareholders to vote in favor of proposals for an independent chairman, the establishment of a climate change board committee and a report on lobbying. The shareholders said they have engaged with Exxon on climate change and its greenhouse gas emissions since 2005 and the company has “failed to respond adequately” in contrast to peers such as BP Plc, Chevron Corp., Royal Dutch Shell Plc and Total SA.
Summarizing this piece in Scientific American: in the early 1980s, the company’s own scientists learned that rising temperatures resulting from the greenhouse gas emissions from fossil fuel consumption would soon cause enormous damage to the planet’s capacity to support life, but, when they reported this to leadership, the executives in place at the time made the deliberate choice to hide all this and embark upon a campaign to sew doubt into the public’s mind about the realities of climate change.
As we’re about to learn, they chose poorly.
Soon, we’ll see how Exxon fares in defending itself against the lawsuit brought by the State of New York’s Attorney General, to the effect that Exxon engaged in “a longstanding fraudulent scheme” to deceive investors by providing false and misleading assurances that it was effectively managing the economic risks posed by increasingly stringent policies and regulations it anticipated being adopted to address climate change, the lawsuit states. “Instead of managing those risks in the manner it represented to investors, Exxon employed internal practices that were inconsistent with its representations, were undisclosed to investors, and exposed the company to greater risk from climate change regulation than investors were led to believe,” the lawsuit said.
ExxonMobil’s attempts to block similar efforts under way in Massachusetts have apparently failed; (from this article) the U.S. Supreme Court declined to take up latest attempt to scuttle Massachusetts’ investigation into whether the oil giant misled the public and investors about climate change, a decision that clears the way for state Attorney General Maura Healey to force the company to turn over records as her office probes whether Exxon concealed its knowledge of the role fossil fuels play in global warming. Those records could open a window into the company’s internal discussions, including its handling of financial and climate data as it charted its business path going back decades.
As the now-famous video (below) tells us, “Exxon Hates Your Children,” an assertion that no one believes to be literally true. What appears obvious, however, is that when it comes to weighing the value of people versus profits, the welfare of your kids is no more important than that of so many cockroaches.
Craig,
Let’s be honest, you (along with others) have waged this completely delusional war on Exxon for years.
During the last ten years, hundreds of millions have been spent employing lawyers, both privately and at taxpayer expense, with no result whatsoever, except to enrich the lawyers and provide a platform for grandstanding politicians.
Court after Court, Judge after Judge has dismissed these absurd cases often awarding heavy damages in favour of Exxon and against the plaintiffs.
Yet you still rant on and on, promising “Final Victory”. Even you can’t say what result you hope to achieve but to vindicate a silly conspiracy theory.
While this campaign must be annoying to Exxon-Mobil, the litigation remains just a minor irritant and doesn’t affect the corporations profitability.
“Shareholder Activism” doesn’t bother Exxon. The share price remains high while the company doesn’t lack eager investors or customers.
Exxon is a hugely profitable company. With revenues of nearly $300 billion and 70,000 employees the company is the single largest US taxpayer, both by percentage and total sum paid.
Despite low oil prices, the company’s share price of $77.13, Annualized Dividend of $3.68 realizing shareholders a fully franked Dividend Yield of 4.5%, means the overwhelming majority of shareholders have faith in the company.
The fact that the share price has continued to rise, despite litigation about climate change, shows any claim shareholders were deceived, or “disadvantaged” is not only illogical, but just plain silly.
(In fact, since 2011, Exxon shareholders have seen their investment return more than double).
But it seems there is no satisfying some of these forlorn crusaders. No matter how delusional, they will persist in holding to their own personal “truth”.
My problem will all this nonsense is it’s a distracts and destroys credibility to attract support for real environmental issues.
Shareholders who disagree with the majority of their fellow shareholders and management of Exxon, have the option of selling their shares (at a profit). Any director elected for a political or ideological reasons, would not be acting in accordance with their responsibilities as a director and be in danger of civil and criminal penalties.
Forget this mad crusade and move on to a more worthwhile use of your talents.