ExxonMobil shareholders on Wednesday supported a measure calling on the oil major to lay out how a rapid global shift away from fossil fuels would affect its finances, according to the Financial Times (FT).
The vote, which was supported by 52 per cent of shareholders is seen as another victory for climate campaigners against America’s most valuable oil company, a year after an activist hedge fund won three seats on its board, the FT said.
The measure requires ExxonMobil to publish an audited report setting out how the International Energy Agency’s modelling for a net zero economy by 2050 would impact the “assumptions, costs, estimates, and valuations” underlying its financial statements, FT said. The report said that Exxon’s management had urged shareholders to vote against the measure, arguing the information was already readily available.
“Today’s vote is a major win for both investors and the planet, and a step change in ensuring company accounts match climate rhetoric,” said Charlie Kronick, senior programme adviser at Greenpeace, the FT report said.
The IEA’s 2050 net zero scenario projects a rapid decarbonisation of the global economy, entailing a deep move away from fossil fuels in order to avoid global warming of more than 1.5C above pre-industrial levels, FT reported. It said the world would not need investment in new large oil and gas projects in that projection.
Exxon earlier this year said it was aiming for its oil and gas operations to be net emissions free by 2050, part of measures it has taken over the past year and a half as it has come under investor pressure to address the threat to its operations from climate change.
FT reported that the motion was backed by a handful of major investors including the NY State Common Retirement Fund, T Rowe Price and California Public Employees’ Retirement System. It said that a similar motion was narrowly defeated last year.
Exxon acknowledged the shareholder vote and said it was continuing to mitigate emissions from its operations.
Tracey Cameron, director of corporate climate engagement at Ceres, a coalition of investors and environmental organisations, was reported by FT as saying that the vote underlined the importance of assessing climate risks.
“Climate risks are also very significant financial risks — that’s no secret among investors,” she said. “While many companies disclose climate impacts in certain places, those disclosures are too often absent, inadequate, or inconsistent in financial statements, fundamentally compromising investors’ ability to effectively manage and allocate their assets”, she said, according to the report.
