A strong and growing 10.3 percent of ExxonMobil (NYSE: XOM) shareholders – accounting for roughly 655.6 million shares worth more than $36 billion -voted in support of a Christian Brothers Investment Services, Inc. (CBIS)-sponsored proxy resolution calling on the world’s largest oil company to explain the scientific basis for its ongoing denial of the broad scientific consensus that the burning of fossil fuels contributes to global climate change. The vote on the CBIS resolution took place during the ExxonMobil annual shareholder meeting held in Irving, Texas. The 10.3% unofficial vote in favor of the resolution urging ExxonMobil to stop ignoring the risks of global warming reflects an increase from the 8.8% of shareholders who lent their support in 2004 to what then was a first-year CBIS proxy resolution.
The CBIS-sponsored resolution asks that, “…by the 2006 annual shareholder meeting, the (XOM) Board of Directors make available to shareholders the research data relevant to ExxonMobil’s stated position on the science of climate change, omitting proprietary information and at reasonable cost.”
“Global warming is not something that ExxonMobil can simply choose to ignore,” said Wilson. “The company’s ongoing denial of the reality of climate change raises concerns that ExxonMobil is unprepared for major shifts in the overall energy markets that we believe may be coming.”
Specifically, the CBIS resolution calls on ExxonMobil to:
(1) “explain the specific differences between the company’s position and that of the Intergovernmental Panel on Climate Change;”
(2) “describe company claims about ‘gaps in climate science’;”
(3) “project the estimated costs of mitigating climate change compared to the costs of failing to do so;” and
(4) “discuss relevant peer-reviewed research data leading to the company’s conclusions, including data that do not support the company’s position.”
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Another resolution, asking ExxonMobil to produce a report on environmental and business related risks of oil drilling in sensitive and protected areas worldwide, such as the Arctic National Wildlife Refuge, received 8.1% of the vote.
The resolution was sponsored by The U.S. PIRG Education Fund, Green Century Capital Management, and Clean Yield Asset Management.
Calpers and Calsters, two of the largest pension funds in the country, supported this year’s resolution. The pension funds made their support for the resolution known to ExxonMobil in separate letters directed to company Chairman and CEO Lee Raymond.
“As a trustee to two pension funds that hold more than 56 million shares, I am calling on ExxonMobil to carefully consider its next step in oil exploration in environmentally protected and sensitive areas,” California State Controller Steve Westly said. “It is important for oil companies to act responsibly and do everything possible to avoid damage to the environment.”
The shareholder resolution on protected and sensitive areas was filed as part of an ongoing campaign led by the U.S. PIRG Education Fund and Green Century Capital Management to protect the Arctic Refuge and to convince the major oil companies operating on Alaska’s North Slope – BP, ConocoPhillips, ChevronTexaco, and ExxonMobil – to abandon any plans to drill there. Despite recent withdrawals of the three other major operators on Alaska’s North Slope from Arctic Power, ExxonMobil remains the only major oil company still funding the pro-drilling lobby group.
“Given the intensity of public support for the Arctic Refuge, ExxonMobil would risk a significant backlash if it decided to operate there,” said Green Century’s Michael Leone. “We believe that shareholders have a right to know why their company is risking shareholder value by publicly promoting a project that is opposed by a majority of Americans.”
BP and Shell, two of ExxonMobil’s major competitors, address their operations in sensitive areas by increasing disclosure. The two companies have also adopted policies to address where development is appropriate and which areas should be preserved.
The resolution specifically called for the company to prepare a report for shareholders examining the potential risks to shareholder value involved in operating in sensitive and protected areas worldwide. A similar resolution received 9 percent of a vote of ChevronTexaco shareholders in April 2005.
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