• Matthew Mancini

Activist Investors Push Exxon for Change

Updated: Feb 11


The logo of Exxon Mobil Corporation is shown on a monitor above the floor of the New York Stock Exchange in New York, December 30, 2015 (Source: Reuters)


By Matthew Mancini

January 31st, 2021


More than 135 investors have formed a coalition to push Exxon Mobil Corp. (XOM: NYSE) to rearrange their board of directors and move toward environmentally friendly methods, according to Reuters.


Amid President Biden’s new Executive Order on Wednesday, the energy company may face barriers in the future. The EO places pause “new oil and natural gas leases on public lands or in offshore waters pending completion of a comprehensive review and reconsideration” to find potentially harmful practices that may adversely affect climate change and negatively impact the environment.


Not only is Exxon facing severe constraints from the Biden Administration, but they have also been suffering from the ongoing pandemic. The price of oil fell below zero for the first time in history back in April due to stockpiles maxing out storage facilities.


Ever since Exxon has been cutting costs by announcing plans to lay off 15% of its workforce and suspending a few employee benefits including matching for employee retirement plans. The company drafted an employee ranking system that arbitrarily labeled employees as poor performers, so it’d be easier to lay them off.


One activist investor, D.E. Shaw Group, has called for higher investments into sustainability technology to curb Exxon’s carbon footprint.


Meanwhile, another investor, Engine No. 1 LLC, has is planning a proxy fight to elect 4 new board members. Back in December, it planned to make the nominations with the support California State Teachers’ Retirement System, which both control only 0.3% of Exxon, so they would need more investors to be on board for their vote to be effective.


Exxon is releasing their earnings on Tuesday and projected to report its fourth consecutive month of losses, the worst period in the company’s history. The proxy fight is said to commence as early as next week which will pile onto the already low projections.