Exxon Sues Investors to Silence Climate Proposal
Oil giant ExxonMobil is taking climate activists Follow This and Arjuna Capital to court to stop their proposal on climate action from being voted on at its yearly investor meeting.
Exxon says these investors have an "extreme agenda." It is rare for companies to go to court over shareholder proposals, and it is the first time Exxon is doing so.
If Exxon wins, it could make it harder for shareholders to bring up similar issues in the future. Normally, companies discuss these proposals with the Securities and Exchange Commission (SEC), but critics argue the SEC's advice changes with different administrations.
Follow This and Arjuna Capital want Exxon to set targets to reduce emissions from the users of its oil and gas (Scope 3 targets).
Currently, Exxon aims for net-zero emissions by 2050 for its production processes and energy consumption (Scope 1 and Scope 2), but it is the only one of the five major Western oil companies without Scope 3 targets.
Exxon says the activists' proposal breaks SEC rules for investor petitions. The company argues that the current process, letting activists push their ideas through many proposals, does not serve investors' interests.
Exxon has asked a Texas district court to remove the Scope 3 proposal from its proxy statement, and it wants a decision by March 19 before its annual shareholder meeting on March 29.
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