Exxon Mobil takes legal action to block climate proposal ahead of shareholder meeting

On Sunday, Exxon Mobil Corp filed a complaint in a Texas court, aiming to thwart a climate proposal put forth by activist investors from reaching a vote during the company’s shareholder meeting in May. This marks the first instance of Exxon seeking to exclude a shareholder proposal through a court complaint, with the case assigned to a judge known for favoring conservative causes.

Exxon contends that the investors, led by U.S. activist investment firm Arjuna Capital and shareholder activist group Follow This, are pursuing an “extreme agenda.” The company argues that the repeated proposals fail to serve investors’ interests or advance long-term shareholder value.

The investors are urging Exxon and other major oil companies to adopt more stringent climate targets, specifically advocating for the establishment of Scope 3 targets to reduce emissions associated with the use of Exxon’s products. Exxon is the sole Western oil major without such targets. Follow This previously made similar proposals in shareholder meetings of other oil majors, garnering 28% approval in 2022 and 10% last year. Exxon claims that shareholders have already rejected Scope 3 targets, seeking to exclude the proposal from its proxy statement.

Exxon’s legal action is directed at the U.S. District Court for the Northern District of Texas, where the company seeks to exclude the Scope 3 proposal from its proxy statement. Arjuna Capital and Follow This were not available for comment regarding the lawsuit as of Sunday night.