The impact of the shock win by an activist investor’s assault on the board of Exxon Mobil – the world’s biggest non-government oil group – has grown with a decisive result in the count for a third director nominee.
In a filing with the US Securities and Exchange Commission on Wednesday, Exxon revealed that activist investor Engine No 1 had won a third board seat from the four nominated.
It is also a victory for some of America’s biggest public sector investors – such as CalPERS, CalSTRS and the New York State Common Retirement Fund, which backed Engine No 1. Massive investor Blackrock reportedly backed three of the four candidates, according to media reports last week.
The news came after trading on Wall Street ended. Exxon shares were up 0.8% at $US60.94.
The activist investor will now be in a position to wield greater influence over the world’s biggest privately-owned energy company.
Exxon’s SEC announcement came a week after the company’s annual meeting and is still based on preliminary results.
But the margins for the three nominees from Engine No 1 are substantial and won’t be overturned.
Engine No 1 had gained two board seats at the meeting out of four nominated, with the position of the third nominee too close to call at the time.
In fact the third position vote was clear: 1.188 billion votes in favour of the nominee to just over 446 million against.
It was no contest and it’s clear Exxon while adjourned the meeting in the middle of proceedings to allow more votes to be cast, it is clear that was desperation and an attempt to soften the embarrassment of seeing three of the four nominees from the activist group easily win election to the board.
“We look forward to working with all of our directors to build on the progress we’ve made to grow long-term shareholder value and succeed in a lower-carbon future,” Exxon’s Chairman and CEO Darren Woods said in a statement Wednesday which recognised the inevitable.
“We are grateful for shareholders’ careful consideration of our nominees and are excited that these three individuals will be working with the full board to help better position ExxonMobil for the long-term benefit of all shareholders,” Engine No. 1 said in a statement Wednesday.
Exxon’s management has emphasised the changes it is making to play its part in a lower-carbon future, including allocating $US3 billion for research around carbon capture and other emissions-cutting technologies.
But Engine No 1 maintained that Exxon was not moving fast enough and that the appointment of two environmentally aware directors earlier this year was too little too late.
The defeat of Exxon’s proposed candidates suggests that shareholders are considering the oil giant’s place in a world that is shifting away from fossil fuels.
