Exxon Rejects Shareholder Requests to Address Climate Change

All six resolutions that touched on climate-related business issues were defeated, but activist shareholders gained more support than ever.

The ExxonMobil shareholders meeting had unprecedented discussion of climate issues
Discussion of climate change was front and center at ExxonMobil's annual shareholders meeting Wednesday. Credit: David McNew/Getty Images

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Following the recommendation of the ExxonMobil board of directors, shareholders voted against six resolutions that would have addressed climate change at the company’s annual shareholder meeting in Dallas on Wednesday.

The resolutions included electing a board member with expertise on climate science, enacting policies to limit global warming, paying special dividends rather than investing more in fossil fuel reserves, and publishing an annual report on how climate policies could affect the company financially.  

Rejection of the initiatives was expected and continued more than a quarter century of opposition to shareholder resolutions by the company on climate change. While none of the resolutions directly related to climate change passed, one that would let minority shareholders nominate outsiders for seats on the board and could thereby provide a pathway for a climate expert to become a board member, did pass with approximately 60 percent of the vote.  

A climate resolution that called for Exxon to publish an annual report on how climate policies will impact the company, including the global goal of limiting warming to 2 degrees Celsius, got 38.2 percent of the vote. No prior climate resolution had ever gained more than 31.2 percent.

Explore in-depth Exxon’s track record – Exxon’s 25 Years of ‘No’: Timeline of Resolutions on Climate Change

“An unprecedented number of Exxon’s shareholders have demanded that it analyze how a 2˚C transition will impact its business,” Robert Schuwerk, senior counsel for the environmental group Carbon Tracker, said in a statement. “Exxon must now meet this demand or confront a more wary investor class next year.”

Ceres, a nonprofit sustainability advocacy group, had helped organize investors representing more than $10 trillion to support the 2-degree resolution. “Given the significant resources Exxon spent fighting this proposal, such a strong vote is a real rebuke to company management,” Andrew Logan, Ceres’ director of oil & gas programs, said in a statement.

A separate resolution went further in calling for a policy committing Exxon to support the goal of limiting climate change to 2 degrees Celsius. This resolution received 18.5 percent of the vote.

The resolution was brought forward by Sister Patricia Daly of the Sisters of St. Dominic of Caldwell, N.J. Speaking at the meeting, Daly said that in urging shareholder rejection of the resolution, Exxon management “has chosen to disregard the consensus of the scientific community, the will of 195 nations that signed the Paris agreement in December, many of our peers in the oil and gas communities, and the calls of faith leaders from the Catholic, Jewish, Christian, Muslim, Buddhist and interfaith traditions.”

Read: Exxon’s Gamble: 25 Years of Rejecting Shareholder Concerns on Climate Change

The votes came as a number of leading oil companies, under mounting pressure, are assessing how they address climate change. The French oil company Total published a report on Tuesday with a goal of supporting the 2-degree goal. The report noted that Total will move away from tar sands oil and Arctic drilling and will apply an internal cost on carbon.

Chevron shareholders voted against several climate-related measures at its annual shareholders meeting on Wednesday. They included a call to publish an annual report on how legislation designed to curb climate change could affect the company.

Exxon, in particular, has faced increased scrutiny of its climate policies from dozens of activist shareholder groups, as well as members of Congress, climate scientists and environmental advocates. In the months following a series of stories last year by InsideClimate News and other news organizations, Exxon became the target of probes by state attorneys general, who are investigating whether the company violated racketeering, consumer protection or investor protection statutes through what it said about global warming.

In Exxon’s meeting, the question-and-answer period grew heated when one shareholder asked chief executive Rex Tillerson when the company would publicly condemn deception on climate change.

“We will never withdraw our support for people to express their free speech opinions on any matter whatsoever,” Tillerson said. “The fact that people have different opinions on climate change, they have every right to their opinion, whether we agree with it or not, I will support their right to say so.” 

When pressed on the need to move quickly away from fossil fuels, Tillerson said, “The reality is there is no alternative energy source known on the planet or available to us today to replace the pervasiveness of fossil fuels in our global economy and in our very quality of life. And I would go beyond that and say our very survival.”

Tillerson said fossil fuel energy is  needed to address the immediate needs of humanity including poverty, starvation, and disease control.

“The only way out of that is to provide them the energy sources we have today,” he said. “That is why we continue to believe fossil fuels will have a significant and important role to play for as far as we can see.”

Sen. Sheldon Whitehouse (D-R.I.), who has led calls for a federal investigation of Exxon’s potential climate fraud, said he was as encouraged by the shareholder activism as he was discouraged by Exxon’s response.

“As someone who sees firsthand the malevolent lobbying presence of ExxonMobil in Congress, I’m not surprised,” Whitehouse said in a statement. “But I am heartened that ExxonMobil’s shareholders rebelled against the corporation in such large numbers. The fossil fuel giant’s days of climate obstruction and obfuscation are numbered.”