Exxon Shareholders Reject Management Candidates to Elect Board Directors Focused on Climate Change
Today, shareholders in ExxonMobil rejected the candidates for the board of directors supported by management, and instead elected multiple directors proposed by activist investors who now have a mandate to shift ExxonMobil's business practices in response to climate change (e.g., by making investments in renewable energy, etc.).
This development reflects the new dynamic in corporate America, where companies are increasingly being held accountable for their activities with respect to climate change--not only by outside activists and government regulators, but by their own shareholders.
As businesses adapt to this changing climate, it is important to always bear in mind the multiple axes that management has to navigate--which now emphatically includes the possibility of decisive shareholder action if management is viewed as unresponsive to these concerns.
Shareholders of Exxon Mobil dealt the company’s management a defeat on Wednesday by electing at least two of four candidates activist investors had nominated to its board — the first time that has happened, according to analysts who follow the company. The election of the remaining seats was too close to call, according to preliminary results announced by the company. A coalition of investors concerned about the environment had argued that Exxon had not invested enough in cleaner energy, which will hurt its profits in the future. And a majority of the company’s shareholders appeared to at least partly agree with that position, according to the preliminary results.