A tiny hedge fund dealt a major blow to ExxonMobil on Wednesday, unseating at least two board members in a bid to force the company’s leadership to reckon with the risk of failing to adjust its business strategy to match global efforts to combat climate change.
The success by hedge fund Engine No. 1 in its showdown with Exxon shocked an energy industry struggling to address growing investor concerns about global warming. It happened on the same day activists scored a big win against another oil major, Royal Dutch Shell – a Dutch court ordered the company to drastically deepen pledged cuts to greenhouse gas emissions.
Eight of Exxon’s nominees including CEO Darren Woods were re-elected to its 12-member board of directors, along with two of Engine No. 1’s nominees, the company said. The counting is not finished, so Engine No. 1 could potentially see three of its four nominees join the Exxon board.
The result will add pressure on Woods, who campaigned to convince shareholders to shoot down the board challenge and argued the company was already diversifying away from fossil fuels and should not jeopardize its profits in doing so.
Under Woods, Exxon incurred a $22 billion loss last year as the COVID-19 pandemic destroyed fuel
