Exxon facing shareholder revolt over approach to climate change
[NOTE: ExxonMobil has been a major source of funding for crackpot
climate change deniers. -jrm]
Andrew Clark in New York
Guardian, May 19 2008
http://www.guardian.co.uk/business/2008/may/19/exxonmobil.oil
A shareholder revolt at ExxonMobil led by the billionaire Rockefeller
family has won the sup****t of four significant British institutional
investors who will call on Monday for a shakeup in the governance of the
world's biggest oil company.
Guardian.co.uk has learned that F&C Asset Management, Morley Fund
Management, the Co-Operative Insurance Society and the West Midlands
Pension Fund are throwing their weight behind a resolution demanding
that ExxonMobil appoints an independent chairman to stimulate debate on
the company's board.
Exxon is facing a rebellion from its investors over its hardline
approach to global warming. The firm has refused to follow rival oil
companies in committing large-scale capital investment to
environmentally friendly technology such as wind and solar power.
The Rockefeller dynasty, whose ancestor John D Rockefeller founded the
original oil business at the core of ExxonMobil, have sponsored four
shareholder resolutions demanding changes at Exxon. One of these calls
on Exxon's chief executive Rex Tillerson, to relinquish his role as
chairman in favour of an outsider to bring in an alternative point of
view.
The London-based cor****ate governance advisory service Pirc intends to
recommend that institutions sup****t this proposal, which is in line with
best practice on cor****ate boards in the UK.
F&C Asset Management's director of governance and sustainable
investment, Karina Litvack, said it could pave the way for a different
attitude at Exxon towards the environment.
"Despite top-notch individual directors, the company's record over the
last decade, particularly regarding climate change, demonstrates that
debate has been lacking," said Litvack. "By bringing in an independent
chairman, the company can better leverage that creativity and challenge,
and avoid over-dominance by management."
Exxon maintains that present green technologies are not financially
viable. But critics on Wall Street and in the City fear that the
company's reluctance to explore alternative energy will prove to be bad
business judgment in the long run as rivals such as BP seek to capture
public affection by re-branding themselves as environmentally sensitive
enterprises.
The Rockefellers point out that Exxon has $25bn (£12.77bn) of capital
investment planned in carbon-based fuel but its environmental commitment
is centered on a relatively modest $100m to fund a Stanford University
project on climate change.
If the rebellion continues to gather pace, Exxon could suffer an
embarrassing defeat at its annual meeting in Dallas later this month. At
last year's meeting, 40% of investors' votes were cast in favour of a
similar call for an independent chairman and the Rockefellers'
involvement this time has raised the profile of the battle.
In the US, three advisory firms – RiskMetrics, Glass Lewis and Proxy
Governance – have urged fund managers to sup****t the Rockefellers'
resolution. The result of the vote is not binding on Exxon but the
company has said that its board will reconsider any of its policies
challenged by successful shareholder resolutions.
An Exxon spokesman last night responded to the British institutions'
stance by re-asserting the company's position that its board is better
placed than investors to decide on the leader****p structure.
In a written response to the shareholder resolutions earlier this month,
Exxon said its board members possesses "considerable experience and
unique knowledge of the challengers and op****tunities the company faces".
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