Shareholders show ride-or-die loyalty to corporate management
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Illustration: Annelise Capossela/Axios
Shareholders are feeling pretty comfy with management at several important companies linked to energy and the environment, just as they confront unpredictable futures.
Why it matters: Votes at annual meetings for companies including Tesla, Exxon, and Shell displayed a critical mass of support — and then some — for top decision-makers at these powerhouse firms.
Driving the news: Tesla shareholders easily backed Elon Musk's compensation package that has fluctuated with the stock price, but estimates range between $44 billion and $56 billion.
- It won 77% of votes cast, per a Tesla securities filing about Thursday's annual meeting.
- It's a vote of confidence despite struggling sales, an aging product lineup, and Musk's...shall we say, mercurial behavior.
- Shareholders were also under pressure, given the possibility Musk could leave if spurned.
Catch up quick: The Tesla vote comes two weeks after Exxon investors overwhelmingly reelected all 12 board members in late May.
- The vote was a referendum of sorts on Exxon's lawsuit against activist shareholders behind a since-withdrawn resolution seeking far tougher climate targets.
- And don't forget that Shell management won a nearly 80% endorsement for its energy transition plan, which the oil giant recently softened.
The intrigue: Yes, I know, shareholders almost always vote in line with management recommendations.
- But not every time. Just three years ago activist investors forced a stunning shakeup of Exxon's board, convincing enough people that the company was off track.
State of play: Axios' Nathan Bomey reports Musk rallied retail investors to his side, helping overcome "no" votes from the likes of the California Public Employees' Retirement System and the New York City comptroller.
- Third-party stock advisory firms Institutional Shareholder Services and Glass Lewis also recommended that stockholders oppose the package.
Threat level: There are all kinds of conflicting opinions about whether oil majors are positioning themselves well amid uncertainties around future demand and climate policies.
- And Tesla faces growing competition and a tough sales environment.
The bottom line: For the moment, investors seem confident that these boardrooms are well poised to build value.
