On May 29, the California Public Employees Retirement System (CalPERS) voted against ExxonMobil’s entire board of directors, including CEO Darren Woods, at the company’s annual general meeting. The California State Teachers’ Retirement System (CalSTRS) only voted against re-elected ExxonMobil CEO and Chairman Darren Woods and Lead Director Joseph Hooley.
CalPERS, a nine-decade-old system, owned around $1.1 million in ExxonMobil stocks and bonds at the end of 2023. CalSTRS, established in 1913, owned $701,467 in Exxon stocks and bonds as of June 2023. CalSTRS is the largest educator-only pension fund in the world and the second-largest pension fund in the U.S.
The votes by CalPERS and CalSTRS came as a response to ExxonMobil’s federal lawsuit against two shareholder groups, Follow This and Arjuna Capital, which submitted a proposal. In its lawsuit, ExxonMobil stated that it filed “this complaint seeking a declaratory judgment that it may exclude Arjuna Capital (“Arjuna”) and Follow This’s shareholder proposal” from a proxy statement. The groups withdrew the proposal, but the company continued the lawsuit. In April, the judge did not dismiss Exxon’s lawsuit. However, the judge dismissed Follow This because it is a Dutch association.
A company website statement characterizes the shareholder proposal process as one that “has become ripe for abuse.” The company believes that the process to get proxy proposals excluded is flawed.
“ExxonMobil’s lawsuit threatens to silence shareholders everywhere by stripping away their rights and role in improving a company’s bottom line,” said CalPERS CEO Marcie Frost.
The Letter Campaign Against ExxonMobil
A letter from CalPERS CEO Marcie Frost and Board President Theresa Taylor told members, “CalPERS will cast our shareholder votes in opposition to all 12 members of ExxonMobil’s board of directors and its chief executive officer.” The letter pointed out that ExxonMobil could have sought permission from the U.S. Securities and Exchange Commission (SEC). SEC officials approved two-thirds of all those types of requests last year.
Fiona Ma, California State Treasurer and a member of the CalSTRS board signed a letter urging the largest global asset manager to vote against Woods and Hooley. The letter stated, “We believe that ExxonMobil’s attempts to undermine shareholder rights reflect a fundamental failure of board oversight and a waste of corporate assets on litigation.”
In the spring, the non-profit California Common Good sent a letter to the CalPERS and CalSTRS board of trustees and staff urging them to “hold Exxon accountable for its unprecedented and extreme lawsuit against its shareholders and its ongoing undermining of the efforts to fight climate change.”
ExxonMobil’s Shoddy Climate Change Record
ExxonMobil is one of the largest publicly held international oil and gas companies globally. It is the largest oil refiner, and its chemical company is one of the world’s largest. ExxonMobil exceeded expectations in 2023 with a $36 billion profit, paid out $14.9 billion in shareholder dividends, and bought back $17.2 billion in stocks. It claims it is “meeting society’s needs for energy and essential products and reducing emissions.”
ExxonMobil also has a steep record of denying climate change. As far back as 1957, the company known then as Humble Oil published a paper linking fossil fuels with increasing carbon dioxide levels. Despite its knowledge, the company actively practiced climate denial. ExxonMobil continues giving to organizations that deny climate change, including $150,000 in 2022 to the American Enterprise Institute.
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