ExxonMobil CEO Darren Woods speaks at the Asia-Pacific Economic Cooperation (APEC) Leaders’ Week in San Francisco, California, on November 15, 2023.
Andrew Caballero-reynolds | Afp | Getty Images
Exxon Mobil filed a lawsuit against U.S. and Dutch activist investors in a bid to stop them from submitting climate proposals during the oil giant’s annual shareholder meeting.
It marks a first for the U.S. oil major and is the latest step in an intensifying battle between companies and environmental campaigners.
The complaint was filed Sunday in the U.S. District Court for the Northern District of Texas against Massachusetts-based investment firm Arjuna Capital and Follow This, an Amsterdam-based activist investor group.
An Exxon Mobil win in the proceedings could have a chilling impact on future shareholder petitions.
Arjuna Capital and Follow This did not immediately respond to a CNBC request for comment.
The Securities and Exchange Commission, the U.S. financial regulator, has overseen a growing number of environmental and social shareholder proposals during the past two proxy seasons.
In an emailed statement, Exxon Mobil said “the breakdown of the shareholder proposal process, one that allows proponents to advance their agendas through a flood of proposals, does not serve the interests of investors.”
The company added, “We are simply asking the court to apply the SEC’s proxy rules as written to stop this abuse and eliminate the significant resources required to address them.”
The oil major has accused Arjuna Capital and Follow This of being driven by an “extreme agenda” and claimed they both submit shareholder proposals to undermine the firm’s business.
In its filing, Exxon Mobil said that it requires relief from the court by March 19, because it must file its proxy statement by April 11. The Houston-based firm is scheduled to hold its annual shareholder meeting on May 29.
Scope 3 emissions
Arjuna Capital and Follow This have sought to put pressure on oil majors to establish so-called “Scope 3” targets to reduce greenhouse house gas emissions produced when burning oil and gas.
Scope 3 refer to the emissions produced from across a company’s entire value chain, and often account for the lion’s share of a firm’s carbon footprint.
Scope 1 emissions meanwhile refer to a firm’s direct greenhouse gas emissions, while Scope 2 are indirect emissions that stem from the production of the energy used on a firm’s behalf.
Exxon Mobil has announced plans to reach net zero by 2050 for Scope 1 and Scope 2 emissions. This target does not include Scope 3 emissions, and shareholders of the company overwhelmingly voted to reject calls for stronger measures to mitigate climate change last year.
— CNBC’s Spencer Kimball contributed to this report.
