Calpers Threatens to Vote Against the Re-Election of Exxon’s CEO

The California Public Employees' Retirement System has threatened to vote against the re-election of Exxon chief executive Darren Woods to the company’s board unless it dropped its lawsuit against two activist investors.

The Financial Times reported that the threat was a response to Exxon’s retaliation against Arjuna Capital and Follow This, the Dutch Big Oil activist pressure group.

In January, the two investors filed a proposal for Exxon shareholders to vote at the annual general meeting on May 29 to have Exxon commit to further emissions reductions, including Scope 3 – emissions from the product it sells.

In response, Exxon filed a lawsuit at the U.S. District Court for the Northern District of Texas, saying that “Defendants are asking Exxon Mobil to change its day-to-day business by altering the mix of—or even eliminating—certain of the products that it sells.”

Exxon also argues that the two activist investors have “become shareholders solely to campaign for change through shareholder proposals that are calculated to diminish the company’s existing business.”

These investors “are aided in their efforts by a flawed shareholder proposal and proxy voting process that does not serve investors’ interests and has become ripe for abuse,” the company also said at the time.

Arjuna Capital and Follow This promptly dropped their Scope 3 proposal but Exxon did not drop the lawsuit. This caused a stir among some shareholders who tried to pressure the company into giving it up.

“Exxon has gone well beyond any other company that we’re aware of in terms of suing shareholders for trying to bring forward a proposal. And even when they drop the proposal, [Exxon is] continuing the lawsuit,” Calpers’ chief operating officer told the FT.

“There doesn’t seem to be anything other than an agenda of sending a message of shutting down shareholders’ ability to speak their mind.”

By Irina Slav for Oilprice.com

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