Pro-Climate Investors to Drop Shareholder Resolution – Forced by Exxon Lawsuit
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February 02, 2024
“Given Exxon’s preference to fight a battle in court rather than allow shareholders the freedom of a vote at its annual meeting, we decided to withdraw the climate proposal,” said the head of an activist investor group.
In what one journalist called “big news for shareholder activism” at powerful companies, a climate-focused investor group said Friday it was withdrawing its proposed resolution for more ambitious emissions reductions at ExxonMobil, which had been submitted under federal guidelines for a vote at the oil giant’s upcoming annual meeting, following the company’s lawsuit filed in right-wing court.
Dutch group Follow This and investment firm Arjuna Capital had planneda shareholder vote on an expansion of Exxon’s emissions targets, which would have included “scope 3,” requiring the company to reduce emissions produced by those who use its products.
Other fossil fuel companies have adopted targets including scope 3 as well as scopes 1 and 2—emissions from their infrastructure and operations.
Exxon has said it plans to reach net-zero emissions from scopes 1 and 2 by 2050, but made clear last month it had no intention of allowing its investors to decide whether it should broaden that plan.
The company sued in the U.S. District Court for the Northern District of Texas, asking a judge to exclude the climate proposal from its proxy statement and arguing that Follow This and Arjuna have failed to garner enough support in previous votes to resubmit the resolution.
Just over 27% of Exxon shareholders supported the proposal in 2022, while the number dropped to 10.5% last year.
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