New York — A coalition of Exxon Mobil investors wants the company to replace its chief executive and move more aggressively on slashing greenhouse gas emissions, saying the company’s newly appointed board members and management have not done enough to transition to clean energy or overhaul spending.
Six months after hedge fund Engine No. 1 successfully placed three new directors on Exxon’s board, the Coalition for a Responsible Exxon (CURE) said management and the board have been too slow to reshape the company.
Exxon’s earnings have recovered from 2020’s losses, posting third quarter earnings of $6.8 billion on the back of rising oil prices, but it has taken a slower approach to energy transition investment than most other oil majors.
“CURE awards the new board an overall grade of D- for failing to make any tangible progress on the targets set by us, other shareholders and independent observers at the time of the annual meeting,” CURE, which has 145 members and oversees $2.5 trillion in assets, said in a report to be released on Thursday.
A spokesman for Exxon did not immediately respond to requests for comment.
The group said Exxon’s corporate plans to 2027, released earlier this month, do not meet a climate transition plan consistent with holding the rise in world temperature to 1.5 degrees Celsius. The group said the plan fails to set segment-specific reduction targets for Exxon’s midstream and downstream businesses.
Exxon set annual capital spending through 2027 at $20 billion to $25 billion, allocating money to low-carbon projects and extending its previously projected investment rate for two years.
The coalition again pushed Exxon to split the chairman and chief executive posts.
Exxon, one of America’s most well-known brands, has five new directors, including three voted in by shareholders earlier this year. Earlier in the year, CURE said the company’s willingness to appoint the new directors signaled that the company “may intend to change.”
CURE is now calling for Chief Executive Darren Woods to be replaced and for the company to appoint an independent board chairman. The group also said the company’s chief and top executives should receive incentive packages tied to achieving 1.5 degree-aligned greenhouse gas targets.
The coalition also took issue with Woods’ pay, noting that he was paid millions even as the company’s value declined by billions of dollars in recent years.
- Reuters (Reporting by Svea Herbst-Bayliss; editing by Richard Pullin)