May 25, 2021 - Energy & Environment

Exxon pledging to add directors ahead of showdown with activist investors

Vehicles refueling at an Exxon Mobil Corp. gas station in Houston, Texas, in October 2020.
Vehicles refueling at an Exxon Mobil Corp. gas station in Houston, Texas, in October 2020. Photo: Callaghan O'Hare/Bloomberg via Getty Images

Exxon is pledging more board additions ahead of a showdown with activist investors pressing for more aggressive moves on climate change and capital discipline on oil development.

Why it matters: The move comes just ahead of Wednesday's annual meeting, when shareholders will vote on whether to approve four board members nominated by the investment group Engine No. 1.

Driving the news: The company said that over the next 12 months it would add two new members, "one with energy industry experience and one with climate experience."

  • The May 23 shareholder communication was disclosed in this filing Monday.
  • The letter, which also touts recent board additions, says the company's capital allocation strategies, cost cuts and expanded climate efforts mean it's "positioned for success."

The other side: "If ExxonMobil’s Board is sincere in its desire to add more relevant experience, then it can wait to see what the outcome of this election is," Engine No. 1 said in a statement.

What they're saying: Andrew Logan, of the sustainable investment advocacy group Ceres, tells Reuters that Exxon's move is aimed at swaying major investors including BlackRock and Vanguard ahead of the vote.

Go deeper: The showdown over Exxon's climate future is here

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