ESG Activists and ExxonMobil

The Story:

Activists who use their ownership of stock in a corporation to push for changes in corporate policy for environmental, social, or good-governance reasons, generically ESG activists, show up in shareholders’ meetings around the country and around the calendar, pressing for resolutions and, sometimes, for board seats. The prep work is now underway for a possible showdown over environmental issues at the Exxon/Mobil meeting scheduled for March 3 of this year.

Background:

The ESG impact fund Engine No. 1, which is backed by the California state teachers’ pension fund, has nominated four candidates for the ExxonMobil board of directors, each with (as its press release says), “track records of success in the energy business.” One of the four nominees is Kaisa Hietala, who was the executive vice president of Renewable Products at Neste for five years. (Neste is a petroleum refining and marketing company in Finland.)

The Thing to Know:

BlackRock, a giant investment fund that owns nearly 5% of the oil giant’s equity, has said that it will hereafter take climate change issues into account in managing its portfolio, “not only in terms of the physical risk associated with rising global temperatures, but also transition risk — namely, how the global transition to a low-carbon economy could affect a company’s long-term profitability.”

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