Just as the president has said the United States would eventually withdraw from the Paris climate accord, the shareholders of the world’s biggest oil company made a very different statement: Exxon Mobil Corp. must increase its transparency and reduce its CO2 releases.
It’s a non-binding proposal that Exxon’s management said it would abide by, although at this early stages has not said how it would do so. Already, the company has asked President Trump remain in global climate change talks. Exxon, of course, is also a major producer of natural gas that is now the primary fuel used in electric generation and one that is helping to reduce the nation’s overall carbon footprint.
The proposal is asking Exxon to gives its shareholders full insight into the financial and technological risks it faces as a result of a world that is trending toward lower CO2 emissions and specifically one that wants to keep temperatures from rising more than 2 degrees Celsius by mid Century.
About 62% of the ballots cast favored such transparency and carbon cutting — and against the wishes of company management; ExxonMobil previously agreed to inform its shareholders as to how its business strategy would conform to a world where there would be greater restrictions to carbon releases.
Last year, the same shareholder proposal just voted on only received 38% support, Reuters reported. The increase may have been because BlackRock endorsed the plan — an asset manager that owns 6% of the company’s stock.
“It’s a powerful message,” New York State Comptroller Thomas DiNapoli told Reuters. “They recognized the global community is staying committed to Paris,” he said, referring to the Paris global climate accord. New York’s pension plan is a major holder of Exxon stock.
Meantime, some state attorneys general are still investigating Exxon for allegedly covering up what it had known about climate change as far as as the 1970s. Massachusetts and New York Attorneys General are leading the fight. They maintain that the oil giant had long-known of the adverse effects of climate change. The AG’s role here is largely to protect the company’s investors, who are entitled to know what management knows.
Those efforts, however, are drawing criticism from free-enterprise groups, which are calling the moves politically motivated. The Competitive Enterprise Institute (CEI), which is a free market think tank, says that the goal here is to cut Exxon down to size.
“The offices of New York Attorney General Eric Schneiderman (D), and other politically-aligned AGs, secretly team[ing] up with anti-fossil fuel activists in their investigations against groups whose political speech challenged the global warming policy agenda,” E&E Legal said it earlier. E&E is reported to be linked to the Competitive Enterprise Institute.
For its part, Exxon has said that its 1970s-based research produced no definitive conclusions. But today, it says that climate change is real and that everyone should be engaged in finding solutions.
Shareholder activism as it relates to climate issues is on the rise. And some CEOs are embracing the message.
Consider that Apple’s Chief Executive Tim Cook just told some of his stockholders who are climate change deniers/skeptics to take a hike. When the National Center for Public Policy Research said that the high-tech giant was wasting shareholder money on climate initiatives, Cook responded by saying that Apple is a concerned with all of its stakeholders, which means being an environmental steward.
Just how the corporate world fuels its energy needs is a big question. Going for the green may be the ideal long-range solution. But first we have to clean the fossil fuels we are using before we can potentially wean ourselves from them. That’s the message delivered by Exxon’s shareholders.