ExxonMobil vows more lawsuits if activist investors continue to abuse proxy rules
(Bloomberg) – Exxon Mobil Corp.’s top executive vowed to sue more activist investors if they continue to “abuse” the proxy voting process, just months after a lawsuit against Arjuna Capital LLC was dismissed by a federal judge.
“The rules and the regulations need to be adhered to,” Chief Executive Officer Darren Woods said at a Council of Institutional Investors conference in New York. “We hope we don’t have to use that action in the future, but if we find people continuing to abuse the process, we’re going to hold them to the rules.”
ExxonMobil sued Arjuna and Dutch non-profit group Follow This in January for repeatedly putting extreme “pro-climate” resolutions on the ballot at its annual meetings.
The company sought a declaratory judgment that would force the Securities and Exchange Commission to more carefully vet proposals that had been voted down in prior years, but the case was dismissed after Arjuna agreed to withdraw the proposal and not file any more.
Woods said on Tuesday that activists are using shareholder resolutions as “Trojan horses” to “drive us out of business.”
“We think the process was being abused to the detriment of the rest of the shareholders,” he said.
Separately, ExxonMobil is in a months-long arbitration battle with arch-rival Chevron Corp. and Hess Corp. over the latter’s 30% stake in its Guyana oil project. Chevron agreed to buy Hess last year to gain access to the project, which is the biggest discovery globally in the past decade.
Woods took exception to claims ExxonMobil is being “unusually aggressive” in both the arbitration and shareholder activist cases.
“There’s a set of rules that have been put in place across both of those examples,” he said. “We’re simply trying to follow those processes as they’ve been laid out.”
