Exxon Mobil Corporation, Chevron Corporation and Royal Dutch Shell Plc forced to rethink as sophisticated activism gets a foothold
Climate activists have landed three big wins and gained influence over some of the world’s largest oil companies.
An activist fund, called Engine No.1, won the board seats at Exxon’s annual shareholder meeting on Wednesday. It owns only 0.02% of Exxon’s shares but won over sufficient number other shareholders in the vote.
Engine No.1 wants Exxon, America’s largest oil company, to move away from fossil fuels.
In all, the activist fund put forward four board nominations and it had the backing of a number of large pension funds.
The US oiler needs directors with experience in successful and profitable energy industry transformations, according to Engine No.1.
Elsewhere, Chevron shareholders voted in favour of a proposal for the company to target reduction in the emissions created by its customers (rather than just those resulting from its own operations).
Some 61% of shareholder votes came in favour of the proposal despite the executive management recommending shareholders vote against.
At the same time, requests for reports on the impact that a significant cut in fossil-fuel demand and political lobbying were both denied by narrow votes.
Earlier in the day, PLC () has lost a landmark case brought forward by seven activist groups, including Greenpeace and Friends of the Earth Netherlands, to challenge its climate strategy.
The Dutch Court of The Hague ordered the FTSE 100 group to reduce CO2 emissions by 45% by the end of 2030 compared to 2019 levels. The 45% reduction also includes ‘scope 3’ emissions, meaning those from burning Shell’s gas and oil.
Before being taken to court by the activists, the company had previously pledged to cut the emissions of the products it sells by 20% over the same time period, as well as setting a net-zero goal by 2050.
The case was filed in 2019 on behalf of more than 17,000 Dutch citizens on the basis that the oiler is threatening human rights by investing in fossil fuels.
As campaigners move from picket lines and social media into boardrooms evidently the landscape is shifting, what precisely it will mean operationally for these ‘supermajor’ hydrocarbon companies remains to be seen.