June 23, 2024

Republican US backs Exxon in shareholder activism dispute

Officials from 19 Republican states on Thursday urged major asset managers not to vote against ExxonMobil directors at a meeting next week, where some shareholders plan to voice opposition to the oil company’s lawsuit against climate activists.

The group, which also includes Florida Treasurer Jimmy Petronis and Louisiana State Treasurer John Fleming, said in a letter to firms including BlackRock, Goldman Sachs and JP Morgan that Exxon’s board “expresses our gratitude and our gratitude to activist shareholders.”

Exxon’s continued lawsuit against Arjuna Capital and its pursuit of the company’s proposal for tougher climate targets even after investor groups pushed back on it has sparked disagreements among shareholders and government officials.

A group of Democratic officials earlier this week urged some of those same asset managers to vote against the board, saying the lawsuit would undermine shareholder rights. Norway’s $1.6 trillion sovereign wealth fund said Friday it would vote against the reappointment of Exxon director Joseph Hooley.

Not all of the signatories to Thursday’s letter have direct influence over voting on companies in which public pension funds invest, but their stance marks a shift from previous shareholder battles over Exxon, in which Democratic public pension funds aligned with climate-related hedge funds.

They did not specifically call for a board vote at the May 29 meeting.

“These activists are filling companies’ proxy statements with politically motivated proposals disguised as business risk mitigation measures,” the letter said.

BlackRock did not respond to a request for comment. Goldman Sachs and JP Morgan declined to comment. Exxon, Arjuna Capital and Follow This did not immediately respond to requests for comment.

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Republican lawmakers took specific exception to Arjuna and follow Exxon’s calls to reduce greenhouse gas emissions from its suppliers and end-users in what is known as Scope 3.

“The only way for Exxon to clean up the Scope 3 emissions is to shut down its operations, cap its wells, close its windows and fire its employees,” the letter said. (Reporting by Isla Binny, Editing by Alistair Bell)