Activist Group Targets Exxon With Shareholder Climate Resolution

Climate activist group Follow This targeted Exxon Mobil Corp with a shareholder resolution urging it to deepen its carbon emissions reduction targets, ramping up pressure on the oil and gas company over its energy transition strategy.

The shareholder resolution ahead of the 2022 annual general meeting urges Exxon to publish medium and long-term targets to reduce the greenhouse gas (GHG) emissions from its operations and the burning of fuels sold to customers, known as Scope 3 emissions, in order to meet the U.N.-backed targets to limit global warming to below 2 degrees Celsius.

Exxon has successfully blocked attempts to file similar resolutions with the Securities and Exchange Commission during the presidency of Donald Trump. Exxon has not responded to an inquiry on whether it would seek to block the latest Follow This resolution.

Dutch organisation Follow This first targeted Royal Dutch Shell in 2016 and later expanded actions to other top oil and gas companies, gaining growing shareholder support. It is the first time it is targeting U.S. companies Exxon and Marathon Petroleum Corp.

Companies have introduced in recent years climate strategies that vary widely in scope and ambition.

It has also filed new resolutions with Chevron, ConocoPhillips, Occidental Petroleum, and Phillips 66, as well as Shell and BP PLC for the 2022 meetings.

"In previous years, Big Oil's executives have shown that they only move after their shareholders vote for climate resolutions," Follow This founder Mark van Baal said in an investor briefing.

A coalition of Exxon investors said in a report released on Thursday that it wants the oil company to replace its chief executive officer and move more aggressively to slash GHG emissions.

Six months after hedge fund Engine No. 1 successfully placed three new directors on Exxon's board to improve its climate approach, the report also said its newly appointed board members and management team have not done enough to transition to clean energy or overhaul spending.

Exxon earlier this month released its new investment strategy into 2027, increasing spending over the next six years on GHG emission-reduction projects to a total of $15 billion.

Chevron's board "reviews proposals from shareholders in detail and will make recommendations to stockholders about how to vote on each request" in its proxy statement, planned for April 7, spokesperson Sean Comey said.

Marathon, BP and Shell confirmed receiving the resolution. Phillips 66 and Conoco declined to comment.