Press Release: Shareholders and State Pension Officials Make the Case Against Two ExxonMobil Directors
May 14, 2024
Wespath Benefits and Investments Contact: Julie Capozzi
Managing Director, Communications
(847) 866-4111
[email protected]
Mercy Investment Services Contact: Amanda Lepoire
Director of Communications
[email protected]
At a briefing attended by hundreds of institutional investors in advance of the May 29 ExxonMobil shareholder meeting, investors and members of the press heard arguments from proponents of a vote against two ExxonMobil directors, CEO and Chair Darren Woods and Lead Independent Director Joseph Hooley.
The briefing’s speakers included Mary Minette of Mercy Investment Services (Mercy) and Lucas Shoeppner of Wespath Benefits and Investments (Wespath) whose organizations have co-filed an exempt solicitation calling for a vote against the directors “due to the company’s hostile treatment of its shareholders, including recent legal action taken by the company intended to silence constructive discussion of its strategy.”
They were joined by Maryland State Comptroller Brooke Lierman and Illinois State Treasurer Michael Frerichs. Together the speakers underscored the importance of investors sending a strong signal to ExxonMobil that legal intimidation of its own shareholders and departure from standard Securities and Exchange Commission (SEC) processes are unacceptable tactics that should invoke a strong investor response.
Said Treasurer Frerichs, “ExxonMobil's unprecedented lawsuit against two shareholders and the latest political efforts to silence others poses a serious threat to American prosperity and competitiveness. Unfortunately, we've seen this before. Where management teams get entrenched, they put up blinders. They lose touch with how markets are evolving and they can't embrace change whether you lead a big hedge fund, work for the largest asset managers or your job is to look after the pension funds of teachers, firefighters, and school custodians. Investors cannot allow their voices to be silenced. The cornerstone of American democracy and wealth is a free market with shareholder voices that are considered in a democratic way.”
Said proponent Lucas Schoeppner of Wespath, “Wespath believes shareholder proposals have made companies like ExxonMobil better prepared for the future, and that investors have the right to decide which shareholder ideas deserve support. Our concern is that Exxon is showing that while it wants investors' capital, it doesn't want their voices. Exxon’s lawsuit sets a negative precedent that we believe will have a chilling effect on future efforts by shareholders pursuing the consideration of proposals seeking to improve corporate sustainability. That’s why we are voting against those board members who have the primary responsibility of overseeing the decision to use company funds to sue shareholders, rather than pursue standard SEC procedures.”
Said proponent Mary Minette of Mercy, “Mercy has been a shareholder in ExxonMobil for decades, and we have engaged the company throughout our ownership. As long-term investors with a history of engagement with the company, we were surprised when ExxonMobil decided to circumvent the SEC process for one of the proposals filed this year and took the extreme step of taking two of its shareholders to court to keep their proposal off the proxy ballot. We were shocked when the company elected to continue its lawsuit even after those shareholders had agreed to withdraw their proposal. But when the company’s 2024 proxy was released, characterizing shareholders with proposals going to a vote as “serial proponents” with fringe concerns and attempting to make distinctions between “investors, who are looking to ensure long-term economic value, and other shareholders, who may have acquired or borrowed a small number of shares to pursue their own agendas” we were, frankly, stunned.”
The speakers noted the support for the initiative declared by several investors including the New York State Common Retirement Fund, the Dutch firm Robeco, and Brunel Pension Partnership, along with the expectation of support from many more investors before the May 29 annual meeting. In addition, CalPERS, the US’s biggest public pension fund with USD 463 Billion in assets under management, stated that they were considering a no vote against the chairman and CEO. The investor’s Chief Operating Investment Officer, Michael Cohen, said in a Financial Times article on May 10 that the ExxonMobil case “doesn’t seem to be anything other than an agenda sending a message of shutting down shareholder’s ability to speak their mind” noting the fund was “deeply concerned” about the case. Fiona Ma, the Treasurer of the State of California said, “Exxon’s actions are a serious threat to shareholder rights and require a strong response.”
In addition, on February 8, Nicolai Tangen, chief executive of Norway’s USD 1.56 Trillion oil fund, told the Financial Times he was concerned about Exxon’s action saying “It’s a worrisome development. We think it’s very aggressive and we are concerned about the implications for shareholders' rights.” His intervention is significant as the oil fund is one of Exxon’s top 10 shareholders with a 1.4 percent stake worth USD 5.4 Billion at the end of 2023.
Said Minette, “ExxonMobil is a public company. Anyone who buys its stock is a shareholder and has the right to avail themselves of the rights granted to shareholders under the rules of the SEC. They have the right to raise issues that are material to the company’s business in shareholder proposals. Some shareholders, like Mercy, avail themselves of this process. Some do not. But all are shareholders, worthy of the company’s respect and worthy to be heard.”
Said Comptroller Lierman, “The resolution ExxonMobil sued over is actually a very simple, commonplace resolution that investors at virtually every other energy company consider: asking whether management teams who are dependent on old discredited ways of selling energy might be more proactive and might prepare better for a clean energy future. Rather than make the case for its board members and allow a vote, Exxon decided to divert shareholder assets into funding lawsuits against its own shareholders. I'm here to say that I'm watching this. I'm paying close attention, and I'm committed over these final weeks leading up to the May 29th shareholder meeting that my fellow trustees, our consultants, and our advisors are going to hear from me about this, and I urge all trustees and investors on this call to do the same.”
Said Frerichs, “The notion that we should circumvent shareholder democracy; a pillar of capitalism is absolutely outrageous and unacceptable. We have market mechanisms that work. I'm grateful that Wespath and Mercy Investments have raised the questions they're asking, and I can assure you that I will not rest until we have held Exxon accountable.”
To view the recording of the investor briefing, see this link with this password (%mMKR&0u)
About Wespath Benefits and Investments (Wespath)
Wespath Benefits and Investments (Wespath) is a not-for-profit agency that has been serving The United Methodist Church (UMC) for over a century. In accordance with its fiduciary duties, Wespath administers benefit plans and, together with its subsidiaries, including Wespath Institutional Investments, invests nearly $26 billion in assets on behalf of over 100,000 participants and over 150 United Methodist institutions (as of December 31, 2023). Wespath invests in a sustainable manner that seeks to achieve positive financial, social and environmental impact while upholding the values of the UMC. Wespath maintains one of the largest reporting faith-based pension funds in the world. For additional information about Wespath Benefits and Investments, please follow us on X (formerly Twitter), Facebook, Instagram, LinkedIn and YouTube.
About Mercy Investment Services
Mercy Investment Services, the asset management program for the Sisters of Mercy and its ministries, works for systemic change in the areas of non-violence, racism, environment, concern for women, and immigration through socially responsible investing. Mercy Investment Services’ multifaceted approach includes corporate engagement, proxy voting, portfolio screening, and impact and community investments, maximizing our effect on our community, nation and world. Learn more about Mercy Investment Services at www.mercyinvestmentservices.org.
Managing Director, Communications
(847) 866-4111
[email protected]
Mercy Investment Services Contact: Amanda Lepoire
Director of Communications
[email protected]
At a briefing attended by hundreds of institutional investors in advance of the May 29 ExxonMobil shareholder meeting, investors and members of the press heard arguments from proponents of a vote against two ExxonMobil directors, CEO and Chair Darren Woods and Lead Independent Director Joseph Hooley.
The briefing’s speakers included Mary Minette of Mercy Investment Services (Mercy) and Lucas Shoeppner of Wespath Benefits and Investments (Wespath) whose organizations have co-filed an exempt solicitation calling for a vote against the directors “due to the company’s hostile treatment of its shareholders, including recent legal action taken by the company intended to silence constructive discussion of its strategy.”
They were joined by Maryland State Comptroller Brooke Lierman and Illinois State Treasurer Michael Frerichs. Together the speakers underscored the importance of investors sending a strong signal to ExxonMobil that legal intimidation of its own shareholders and departure from standard Securities and Exchange Commission (SEC) processes are unacceptable tactics that should invoke a strong investor response.
Said Treasurer Frerichs, “ExxonMobil's unprecedented lawsuit against two shareholders and the latest political efforts to silence others poses a serious threat to American prosperity and competitiveness. Unfortunately, we've seen this before. Where management teams get entrenched, they put up blinders. They lose touch with how markets are evolving and they can't embrace change whether you lead a big hedge fund, work for the largest asset managers or your job is to look after the pension funds of teachers, firefighters, and school custodians. Investors cannot allow their voices to be silenced. The cornerstone of American democracy and wealth is a free market with shareholder voices that are considered in a democratic way.”
Said proponent Lucas Schoeppner of Wespath, “Wespath believes shareholder proposals have made companies like ExxonMobil better prepared for the future, and that investors have the right to decide which shareholder ideas deserve support. Our concern is that Exxon is showing that while it wants investors' capital, it doesn't want their voices. Exxon’s lawsuit sets a negative precedent that we believe will have a chilling effect on future efforts by shareholders pursuing the consideration of proposals seeking to improve corporate sustainability. That’s why we are voting against those board members who have the primary responsibility of overseeing the decision to use company funds to sue shareholders, rather than pursue standard SEC procedures.”
Said proponent Mary Minette of Mercy, “Mercy has been a shareholder in ExxonMobil for decades, and we have engaged the company throughout our ownership. As long-term investors with a history of engagement with the company, we were surprised when ExxonMobil decided to circumvent the SEC process for one of the proposals filed this year and took the extreme step of taking two of its shareholders to court to keep their proposal off the proxy ballot. We were shocked when the company elected to continue its lawsuit even after those shareholders had agreed to withdraw their proposal. But when the company’s 2024 proxy was released, characterizing shareholders with proposals going to a vote as “serial proponents” with fringe concerns and attempting to make distinctions between “investors, who are looking to ensure long-term economic value, and other shareholders, who may have acquired or borrowed a small number of shares to pursue their own agendas” we were, frankly, stunned.”
The speakers noted the support for the initiative declared by several investors including the New York State Common Retirement Fund, the Dutch firm Robeco, and Brunel Pension Partnership, along with the expectation of support from many more investors before the May 29 annual meeting. In addition, CalPERS, the US’s biggest public pension fund with USD 463 Billion in assets under management, stated that they were considering a no vote against the chairman and CEO. The investor’s Chief Operating Investment Officer, Michael Cohen, said in a Financial Times article on May 10 that the ExxonMobil case “doesn’t seem to be anything other than an agenda sending a message of shutting down shareholder’s ability to speak their mind” noting the fund was “deeply concerned” about the case. Fiona Ma, the Treasurer of the State of California said, “Exxon’s actions are a serious threat to shareholder rights and require a strong response.”
In addition, on February 8, Nicolai Tangen, chief executive of Norway’s USD 1.56 Trillion oil fund, told the Financial Times he was concerned about Exxon’s action saying “It’s a worrisome development. We think it’s very aggressive and we are concerned about the implications for shareholders' rights.” His intervention is significant as the oil fund is one of Exxon’s top 10 shareholders with a 1.4 percent stake worth USD 5.4 Billion at the end of 2023.
Said Minette, “ExxonMobil is a public company. Anyone who buys its stock is a shareholder and has the right to avail themselves of the rights granted to shareholders under the rules of the SEC. They have the right to raise issues that are material to the company’s business in shareholder proposals. Some shareholders, like Mercy, avail themselves of this process. Some do not. But all are shareholders, worthy of the company’s respect and worthy to be heard.”
Said Comptroller Lierman, “The resolution ExxonMobil sued over is actually a very simple, commonplace resolution that investors at virtually every other energy company consider: asking whether management teams who are dependent on old discredited ways of selling energy might be more proactive and might prepare better for a clean energy future. Rather than make the case for its board members and allow a vote, Exxon decided to divert shareholder assets into funding lawsuits against its own shareholders. I'm here to say that I'm watching this. I'm paying close attention, and I'm committed over these final weeks leading up to the May 29th shareholder meeting that my fellow trustees, our consultants, and our advisors are going to hear from me about this, and I urge all trustees and investors on this call to do the same.”
Said Frerichs, “The notion that we should circumvent shareholder democracy; a pillar of capitalism is absolutely outrageous and unacceptable. We have market mechanisms that work. I'm grateful that Wespath and Mercy Investments have raised the questions they're asking, and I can assure you that I will not rest until we have held Exxon accountable.”
To view the recording of the investor briefing, see this link with this password (%mMKR&0u)
About Wespath Benefits and Investments (Wespath)
Wespath Benefits and Investments (Wespath) is a not-for-profit agency that has been serving The United Methodist Church (UMC) for over a century. In accordance with its fiduciary duties, Wespath administers benefit plans and, together with its subsidiaries, including Wespath Institutional Investments, invests nearly $26 billion in assets on behalf of over 100,000 participants and over 150 United Methodist institutions (as of December 31, 2023). Wespath invests in a sustainable manner that seeks to achieve positive financial, social and environmental impact while upholding the values of the UMC. Wespath maintains one of the largest reporting faith-based pension funds in the world. For additional information about Wespath Benefits and Investments, please follow us on X (formerly Twitter), Facebook, Instagram, LinkedIn and YouTube.
About Mercy Investment Services
Mercy Investment Services, the asset management program for the Sisters of Mercy and its ministries, works for systemic change in the areas of non-violence, racism, environment, concern for women, and immigration through socially responsible investing. Mercy Investment Services’ multifaceted approach includes corporate engagement, proxy voting, portfolio screening, and impact and community investments, maximizing our effect on our community, nation and world. Learn more about Mercy Investment Services at www.mercyinvestmentservices.org.