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Activists Shareholders Removes two Exxon Directors from Board

A hedge fund won enough investors' support to expel at least two directors from ExxonMobil Board

Activists Shareholders Removes two ExxonMobil Directors from Board

A hedge fund won enough investors’ support to expel at least two directors from ExxonMobil, a big loss for the once-mighty company. Whereas the fund previously criticized the climate strategy of the oil giant. For the first time in the modern history of the country, the United States’ largest oil company faced a credible challenge from an activist investor, such as Engine No. 1.

After upsetting the financial performance and climate foot-dragging of ExxonMobil, the activist shareholder sought to oust four other directors at the annual shareholder meeting of the company. Activists Shareholders Removes two Exxon Directors from Board. Moreover, in the shareholder vote, Engine No. 1 won two board seats. In the same way, two more board seats were still too close to call yesterday.

IEA Warned the World to Stop Drilling for Oil and Gas

The recent vote is the major breakthrough in the climate fight because it the primary proxy campaign at a major American company in which the case for change was made around the shift away from fossil fuels. Whereas the removal of two Exxon directors send a clear message to other fossil fuel companies at a time when the International Energy Agency (IEA) warned the global officials to stop drilling for oil and gas immediately to avoid climate disaster.

Engine No. 1 slammed the unwillingness of Exxon to expand into renewable energy and steps to maximize oil production. The executive chair and founder of the Carbon Tracker Initiative, Mark Campanale, stated that investors sent a shot across the Exxon bow, but its impact will echo across the boards of directors of every key fossil fuel company.

According to the company source, the board directors of ExxonMobil will reconsider two investors’ proposals that received majority approval from the shareholder. Additionally, these proposals include Item No. 9 and Item No. 10, which call for a report on lobbying and request a report on climate lobbying, respectively.

Activists Shareholders Removes two Exxon Directors from Board
Activists Shareholders Removes two Exxon Directors from Board
Source: Web

Stumbles Opened the Door to Insurgency

Exxon, the world’s most valuable oil company, lost approximately $200 billion in market capitalization as recently as in 2013 since its peak. The company enjoyed a continuous run as a member of the Dow Jones Industrial Average from 1928 until Jones kicked out of the exclusive index last summer.

According to Engine No. 1, before the coronavirus pandemic, during the five years, the total return of Exxon drop by almost 17.5 percent. That was last among the five world’s biggest oil companies during that time frame, with ExxonMobil the only one company suffering a loss. The S&P 500 plunged approximately eighty percent during the same span.

Whereas in 2021, Exxon recovered when oil prices mounted. The share price is up almost forty-one percent this year, almost multiplying the advance of S&P. Still, ExxonMobil remains far away from the record highs hit in mid-2014.

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