In a bizarre corporate move, this week ExxonMobil sued two of its investors in an attempt to block a shareholder proposal calling for the company to step up its efforts to cut greenhouse gas emissions. The oil giant, which filed the lawsuit in a Texas court against Arjuna Capital and Follow This, accused the investment firms of overstepping their role. Included in their proposal is a request for Exxon, which is the only Western oil giant without ‘scope 3’ targets, to set such targets and elevate the company’s climate disclosures to its full value chain.
In The Media
“That Exxon — Exxon — feels comfortable throwing its corporate might against a couple of low-budget activists says a lot about how quickly the political weather has changed … Exxon could have let this proposal onto the ballot and watched it fail, just like it did in 2022 and 2023. But the case, filed in business-friendly Texas, feels designed to send a message.” – Liz Hoffman, Business & Finance Editor at Semafor
“This is the first time Exxon is seeking to exclude a shareholder proposal by filing a complaint in court. The case was assigned to a judge with a track record of ruling in favor of conservative causes.” – Sabrina Valle and Nate Raymond, Reuters
“The decision is highly unusual and marks an aggressive pushback against climate activists who use shareholder voting to influence boardroom strategy.” – Brian Croce, Reporter at Pensions & Investments
“While these types of shareholder proposals often don’t succeed, they can influence a company’s policies by forcing executives to respond. In 2021, Exxon Mobil suffered a stunning defeat when a tiny hedge fund, Engine No. 1, won two board seats by pushing for a more proactive clean-energy strategy.” – Lukas I. Alpert, Reporter at MarketWatch
“Exxon has set a goal to reduce emissions from its own operations to net zero by 2050. The bulk of emissions behind global warming come from the burning of oil and gas, however, rather than energy used in operations.” – Patrick Temple-West and Myles McCormick, Financial Times
On Social Media
“Exxon sues its shareholders to block a vote on whether it should strengthen its GHG emissions reduction targets. Case was filed outside of the Southern District of TX where it is headquartered. Why? Northern District judge has a ‘track record.’” – @Kostyack
“Seems a little extreme given the history of shareholders of energy/oil/utility companies voting down these types of proposals” – @BizWriterKristi
“Exxon files lawsuit against investors – its owners – to avoid shareholder proposal for scope 3 emissions reduction. Unusual corporate governance turn!” – @sdg_brooks
“Fossil fuel corps don’t even want to listen to their own investors on #ClimateAction: Exxon files lawsuit against investors’ climate proposal #fossilfuels #Exxon #ClimateJustice”
– @LarryNeufeldSK
“#Exxon filed a complaint in order to prevent a #climate proposal by investors from going to a vote claiming the investors are “driven by an extreme agenda”. Really? The investors demand scope 3 emission targets! Let’s divest from Exxon. They’re pathetic.” – @DorotheaBaur
