In the news: ‘Shareholders are voting their displeasure in record numbers’

Say on Climate news from the Financial Times, Responsible Investor and more.
12 June 2024
shareholder voting on climate

From SEC no-action requests to the latest goings-on of the current oil and gas proxy season, here is the most recent news on Say on Climate. 

ExxonMobil’s Scorched Earth Lawfare Tempts Fate: Why it Matters

Financial Times, May 28th 2024

The Financial Times writes that ExxonMobil’s legal battle against Arjuna Capital over climate-related shareholder votes has backfired, prompting a larger revolt from major investors like Norway’s wealth fund and Calpers. While Arjuna’s proposals were previously rejected, Exxon’s heavy-handed court action has angered some shareholders, raising broader concerns about shareholder rights and corporate governance. Despite its $500bn market cap, Exxon faces increasing opposition from institutional investors wary of its aggressive tactics and stance on social issues.

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Big Oil’s Winning Streak Forces Activist Investors to Regroup

New York Times, May 28th 2024

Activist investors face setbacks as ExxonMobil and Chevron maintain strong profits and record crude production. Despite recent climate protests at Shell, major oil companies have resisted shareholder demands for stricter climate targets, reports the New York Times. Exxon’s aggressive legal tactics against activist groups have provoked backlash from significant institutional investors. Activists are now focusing on gaining support from major investment firms, fearing Exxon’s approach may weaken broader shareholder rights, both on climate issues and beyond them. 

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SEC views more shareholder proposals as micromanagement efforts

Legal Dive, June 7th 2024

During the 2024 proxy season, the SEC granted 139 no-action requests from companies to exclude shareholder proposals, up from 76 the previous year, reports Legal Dives. This increase was mainly due to a rise in proposals, with the approval rate increasing slightly to 68%. Many approvals cited micromanagement, especially for climate-related proposals. A 2021 policy change emphasising the detail level in proposals led institutional investors to reject overly prescriptive ones, influencing SEC decisions to side more with companies.

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Australia’s economic transition — from carbon intensity to climate resilience 

Responsible Investor, June 7th 2024

Australia’s transition to net-zero emissions is hindered by its reliance on fossil fuels. Despite obstacles, progress is evident in renewable energy growth and investor involvement, reports Responsible Investor. In this space, shareholders are increasingly influential, “voting their displeasure in record numbers.” The government mandates climate disclosures and sustainable finance strategies to ensure credible transition pathways, however, concerns about genuine climate action persist.

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Shell’s Climate Transition Plan Wins Shareholder Blessing: Why it Matters

Green Biz, June 5th 2024

Shell shareholders approved a revised transition plan, signalling a preference for short-term profits over long-term climate goals. The plan reduces 2030 carbon intensity and Scope 3 emissions targets and drops a 2035 interim target aligned with the Paris Agreement. While Shell will publish updates every three years, the plan’s focus on carbon intensity allows for overall emissions increases. 

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12 June 2024