An activist investor has launched a proxy fight against Exxon Mobil, pressuring the U.S. oil giant to focus more on renewable energy to improve its financial performance.
Engine No. 1, a San Francisco-based investment firm founded by technology hedge fund veteran Chris James, on Wednesday nominated four candidates to join Exxon’s board of directors. The four independent director nominees -- Gregory Goff, Kaisa Hietala, Alexander Karsner and Anders Runevad -- all have experience in oil and gas and renewable energy. The firm’s move Wednesday to nominate four new directors to Exxon’s board officially launches its proxy fight to wrest control over the company’s direction.
“Investors increasingly want to see companies focused on the long-term and ExxonMobil is no exception,” Engine No. 1 said in a statement. “We believe that ExxonMobil’s Board needs new members who have proven success positioning energy companies for today as well as tomorrow, and who are sufficiently independent from the current Board to ensure a clean break from a strategy and mindset that have led to years of value destruction and poorly positioned the Company for the future.”
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Exxon on Wednesday said it has engaged with Engine No. 1 since mid-December and will evaluate the firm's nominees. It said the company will continue to update shareholders in the coming weeks on the company’s long-term strategy and its actions to address climate change, including initiatives to commercialize technologies which are key to reducing emissions and meeting societal goals consistent with the
Paris Agreement.
"ExxonMobil remains committed to investing in the company’s industry-leading advantaged opportunities, significantly reducing costs and improving operational performance to deliver improved shareholder returns and maintain a strong and reliable dividend," the company said in a statement.
Exxon, the world’s most valuable company just eight years ago, faces mounting pressure from some investors to change course as the oil giant reels from the worst oil bust in decades driven by the coronavirus pandemic. The Irving company has slashed billions of dollars from its capital budget, froze its dividend for the first time in nearly four decades and is laying off thousands of workers in an effort to streamline its operations in the face of low oil prices.
During the downturn, Exxon’s market value has plunged by more than 50 percent to $191 billion from a high of $418 billion in 2013. The oil giant last year was removed from the list of companies that make up the Dow Jones Industrial Average, a group of 30 key stocks that serves as a benchmark for the U.S. stock market. Exxon’s exit left Chevron as the only energy stock on the Dow.\
Engine No. 1, which is supported by one of the nation’s largest pension funds California State Teachers Retirement System, sent a letter last month to Exxon’s board pushing for the embattled energy company to address the risk posed by climate change to its business. The activist investor wants Exxon to “re-energize” itself by investing more money into renewable energy, refreshing its board and overhauling its executive compensation.
Exxon stock fell 2 percent to $44.91 in early Wednesday trading.
https://www.houstonchronicle.com/business/energy/article/Activist-investor-launches-proxy-fight-against-15901754.php
2021-01-27 15:04:00Z
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