EXXONMOBIL shareholders have voted 62.3% in favour of a motion forcing the company to disclose how the business will be affected by global efforts to mitigate climate change.
The proposal was put forward by a group of investors representing US$5trn of assets, led by the Church of England and Thomas DiNapoli, the New York State Comptroller who is the state’s chief fiscal officer. The resolution asked ExxonMobil to report on how global efforts to limit global temperature rises to below 2?C will impact the company’s business model. The vote in favour of the proposal came in spite of strong opposition from ExxonMobil.
Moody's Global Rating already includes the lower demand for fossil fuels as a result of climate change mitigation efforts as a risk when rating companies in susceptible areas such as energy. Several other major oil companies already produce shareholder reports looking at climate change mitigation scenarios, including BP, ConocoPhillips, Royal Dutch Shell and Total.
This is the second time ExxonMobil investors have put forward the proposal. Last year, only 38% of shareholders backed the move. Occidental shareholders also recently backed a similar proposal, and analysts say this shows increasing investor awareness and concern.
“This is an unprecedented victory for investors in the fight to ensure a smooth transition to a low carbon economy. Climate change is one of the greatest long-term risks we face in our portfolio and has direct impact on the core business of ExxonMobil. The burden is now on ExxonMobil to respond swiftly and demonstrate that it takes shareholder concerns about climate risk seriously,” said DiNapoli.
Edward Mason, head of responsible investment at the Church of England said that the vote is “historic”. He thanked the investors who supported the proposal and called on ExxonMobil to “begin urgent engagement with shareholders on how to bring its disclosures in line with those of its peers.”
ExxonMobil has not commented on the matter.
The news comes as reports emerge from the US that US President Donald Trump, whose secretary of state is former ExxonMobil CEO Rex Tillerson, is planning to withdraw the US from the Paris climate agreement. The BBC
says that it has seen the draft of joint statement from Chinese and EU leaders stressing their “highest political commitment” to implementing the measures agreed.