Activist shareholders are using Exxon Mobil’s annual meeting to accuse the company of failing to confront a future that may include stricter regulations to limit climate change caused by burning fossil fuels.
A representative of the Church of England’s endowment fund said Wednesday that Exxon has moved more slowly than other major oil companies to disclose information about emissions.
Chairman and CEO Darren Woods defended the company, saying “we are doing our part” by providing energy that people need while also reducing emissions from its own operations.
Exxon successfully petitioned the Securities and Exchange Commission to block a shareholder vote on setting targets for reducing carbon emissions from burning oil and gas.
Exxon’s 2018 profit rose 6% to $20.8 billion as higher prices offset a 4% decline in production, but the shares fell 18% last year. They had gained 6% in 2019 through Tuesday.
Woods said Exxon’s businesses performed well in 2018, and production in the Permian Basin of west Texas and New Mexico is growing faster than expected.
Exxon continues to project that demand for oil will grow nearly 1% a year, propelled by its use in transportation and chemicals, and Woods repeated a goal of doubling 2017 earnings by 2025.
The bulk of shareholder comments at the meeting, however, dealt with climate change, not the company’s business forecast.
Edward Mason, representing the Church of England’s fund, said that with Exxon, progress on getting the company to discuss climate change and how it will affect the company’s business has been painfully slow.
“Company and investors have been in open conflict about climate strategy and disclosure,” Mason said. He contrasted that with rivals including BP Plc, which last week supported a successful shareholder resolution to increase disclosures about its emissions and how its business strategy fits with the Paris agreement to limit the increase in global temperatures.
The Church of England and the New York state comptroller were lead sponsors on a resolution that would have asked the company to set targets on emissions from burning oil and gas. The SEC, however, accepted Exxon’s objection that the resolution would have amounted to unnecessary meddling into the company’s decision-making authority.
Shareholders handily elected all 10 board-backed director candidates. They overwhelmingly rejected resolutions to create a board committee to deal with climate change and to report on the environmental risks of the company’s petrochemical investments along the Gulf Coast.
About 41% of shares were cast in favour of a measure to split the jobs of chairman and CEO after Woods leaves. Even though the measure failed, it attracted the most support ever at Exxon, which shows shareholders are dissatisfied with Exxon’s governance and handling of climate risk, said New York State Comptroller Thomas DiNapoli.