Vanguard and blackrock force exxon to factor climate change into business model – the washington post electricity labs high school


The shareholder rebellion at the ExxonMobil annual meeting in Dallas was led by major financial advisory firms and fund managers who traditionally have played passive roles. Although the identity of voters wasn’t disclosed, a source electricity balloon experiment familiar with the vote said that major financial advisory firm BlackRock had cast its shares in opposition to Exxon management and that Vanguard and State Street had likely done the same. All three financial giants have been openly considering casting their votes against management on this key proxy resolution.

The shareholder vote on climate change came on a day when President Trump appeared to be nearing a decision on whether to exit the Paris climate agreement, underlining the deep political and economic divisions over how to deal with the global challenge. Even as the Trump administration’s commitment to the climate accord wavered, the o goshi Exxon vote showed that climate concerns were gaining ground in the business world.

BlackRock and Vanguard are the biggest shareholders in ExxonMobil, owning 13 percent, or $43.6 billion worth, of the company’s stock. State Street Global Advisers, another big financial advisory firm that has called for greater climate disclosures, is close behind with 5.1 percent of the stock. The vote by them against management marked an important step for groups that have been trying to force corporations to adopt greater disclosure and transparency about the financial fallout of climate change.

“This is an unprecedented victory for investors in the fight to ensure a smooth transition to a low carbon economy,” said New York State Comptroller Thomas 3 gas laws P. DiNapoli, a trustee of the New York Common Retirement Fund which co-sponsored the proxy resolution. “Climate change is one of the greatest long-term risks we face in our portfolio and has gas refrigerator not cooling direct impact on the core business of ExxonMobil,” he said in a statement.

The resolution, which was co-sponsored by the New York City pension fund, says that the company “should analyze the impacts on ExxonMobil’s oil and gas reserves and resources under a scenario in which reduction in demand results from carbon restrictions and related rules or commitments adopted by governments consistent with the globally agreed upon 2 degree [Celsius] target.”

This month similar resolutions demanding that management explain how climate change could affect their businesses were adopted at Occidental Petroleum and PPL, a large utility holding company. Occidental’s shareholders backed power outage houston reliant the resolution with a 67 percent majority, including BlackRock in its first vote ever against a company’s management over the climate issue. Similar resolutions fell just short including at Dominion with 48 percent and Duke Energy and Southern Co with 46 percent each.

Major shareholders have also leveled criticism at ExxonMobil’s board of directors. Worried about the outcome of the Wednesday votes, the oil giant on Tuesday issued an addendum to its proxy statement, providing additional arguments and information to bolster its recommendation that shareholders reject resolutions about the responsiveness of the company’s board of directors.

While the management prevailed, the votes showed widespread discontent among Exxon shareholders. One resolution, requiring that wd gaster website a director running unopposed garner a majority of votes cast, was supported by 45.7 percent of the shares despite the opposition of management. A resolution backing an independent chairman separate from the chief executive garnered 38.2 percent. And a resolution that would enable 15 percent of shareholders the call a special meeting won 40 percent of the votes cast.

ExxonMobil rarely loses a shareholder resolution. Last electricity images cartoon year, ExxonMobil lost a vote over “proxy access,” which would enable large shareholders to nominate their own candidates for the board directly on the company’s ballot. The previous setback was in 2006, when a resolution relating to the election of directors received about 52 percent of the votes. After that, the company implemented a new policy about director resignations.

At a recent Chamber of Commerce panel about whether the SEC should require greater disclosure, historian and oil industry expert and consultant Daniel Yergin said that events that take place in 30 years might not be material for youtube electricity Big Oil and gas companies and that it went “beyond the scope of what investors need to make decisions.” He said that there was a difference between scenarios and forecasts that provide foundations for financial planning. And financial regulation should not turn into climate regulation, he added.

But Gretchen Goldman, research director at the center for science and democracy at the Union of Concerned Scientists, said that investors “are right that climate change can pose material risks to companies and that this is another indication that investors are demanding this information and are not satisfied with the way companies are acting.”

“We believe the gas x directions risks of climate change are serious and warrant action, thoughtful action,” Woods said, repeating the proxy points. He said that the company uses a carbon cost to measure repeated potential impacts. But he defended the company’s mission, saying that “there’s a moral imperative to bring energy to people who live in energy poverty.”

Exxon’s feud over access to directors has added to friction with major shareholders. Edward Kamonjoh, of the 50/50 Climate Project, said that ExxonMobil barred shareholders from “engaging in a direct and unfiltered way” with directors. He called the board “ossified” thanks to the way it chooses new directors and the financial gas upper stomach incentives for directors to serve until the age of 72.