USA: ExxonMobil Shareholders Use Stock to Push Change
As with other behemoth multinational companies, Irving-based ExxonMobil's annual meeting is strictly a formality. Most of the crowd that packed the Morton H. Meyerson Symphony Center in downtown Dallas to vote on shareholder resolutions last week were retirees who own relatively small amounts of company stock. The majority of big institutional investors and other heavy hitters stayed home and submitted "proxy" votes in advance, the equivalent of an absentee ballot.
But the affair at the elegant fine-arts palace was hardly low-key. Rather, it was a festive and boisterous media circus orchestrated by Catholic clergy, Protestant ministers, and Jewish rabbis who have joined forces with environmental and other groups, such as Ozone Action and Friends of the Earth, to form "Campaign ExxonMobil." For several years, the activists, part of the New York-based Interfaith Center on Corporate Responsibility, have used shareholder meetings to protest the policies of Exxon and now the merged ExxonMobil company, stepping up their protests this year by debuting their "Campaign ExxonMobil" coalition.
Their beef: The fossil fuel conglomerate, the nation's third-largest company according to Forbes magazine, has endangered the planet by refusing to acknowledge global warming, despite decisions by other (smaller) oil companies to do so and the faith group's assertion that "overwhelming, mainstream scientific consensus" proves its existence. Outside of the well-guarded Meyerson center last Wednesday, dozens of activists rallied with colorful signs (one read "No planet, no dividends"), joined by a protester in a tiger outfit and a giant inflatable earth with the Exxon Valdez oil tanker crashing through it.
The problem, say activists, is one of philosophy. "ExxonMobil has to move from being a fossil fuel company to an energy company" by investing in renewable sources of power, says Brother Michael Crosby, a Milwaukee monk in the Capuchin order and longtime shareholder activist. He equates ExxonMobil's unwillingness to acknowledge global warming with the tobacco industry's previous refusal to admit its products cause cancer. Transferring between flights en route to Dallas at Chicago's O'Hare airport, he was provoked by a large-scale model of a dinosaur to draw a comparison. "I thought...I'm going to a company that has a neolithic view of energy," Crosby says.
But Crosby and other activists weren't content to merely picket on the sun-baked street. The interfaith group, which counts 300 churches and synagogues as members, uses the leverage of $100 billion in stocks invested in clerical pension funds to enter the corporate chamber and protest on issues ranging from diversity to military contracts. The center controls about a million shares of ExxonMobil stock, worth about $81 million. That's a tiny fraction of the 3.5 billion shares that make up the $165 billion company, but enough for activists to attend annual meetings, submit resolutions, and speak as concerned "shareholders" worried about company policies and prospects.
Despite the protest's focus on global warming, however, activists couldn't submit a resolution on global climate change since a previous resolution was overwhelmingly defeated at a January meeting. So instead, they petitioned the company to increase its investment in renewable energies, such as solar, wind, and biomass power sources. Other resolutions submitted by coalition members called for a ban on drilling in the pristine Arctic National Wildlife Refuge, more study of a drilling and pipeline project in the repressive nations of Chad and Cameroon, and creation of a panel to study linking executive pay to environmental performance.
The activists left that day claiming a victory of sorts. Even though ExxonMobil chairman Lee Raymond, known for his brusque treatment of critics, refused to budge from his stance on "so-called" global warming, a larger-than-expected chunk of shareholders voted in agreement with the interfaith group, which sent solicitations to 58 percent of the company's shareholders. By the numbers, 6.2 percent of Exxon-Mobil shareholders that voted sought greater investment in renewable energy and 7.7 percent agreed executive pay should be tied to environmental performance.
Protesters were especially pleased with the renewable-energy tally, which they claimed doubled their goal of 3 percent (the number that permits them under federal regulations to submit their resolutions again at the next annual meeting). "We only control 1 million shares, which means 172 million share votes came from somewhere else," Altman says. "That tells us some other major shareholders or investment companies with a lot of votes agreed with us."
Why single out ExxonMobil? The company's environmental record is "horrendous," says Sister Pat Daly, a founder of the campaign who claims the oil giant has isolated itself as other oil titans increase research into renewable energy. Moreover, the group contends, lobbying pressure by ExxonMobil is holding up worldwide action on environmental protection. While BP/Amoco, Shell, and Texaco recently left the Global Climate Coalition, an industry group that publishes studies critical of global-warming claims, ExxonMobil has not and regularly publishes ads and materials deeming climate change an "unsettled science."
The religious activists also blame ExxonMobil for the failure of the Kyoto Protocol, a worldwide treaty to reduce greenhouse gas emissions, in the U.S. Senate. Still, why are monks and nuns stepping up to become environmental activists? Gathering before the annual meeting at nearby Cathedral Santurio de Guadalupe, Brother Crosby said protesting major companies fulfilled a religious calling, since climate change could hurt God's creation. "This is where we can appeal to the shareholders and the public," he says. "For us, it's an opportunity for preaching, for addressing the inequalities and imbalances of society and the ethical issues related to corporate power in America."
Standing at the podium underneath a huge organ, ExxonMobil's Lee Raymond seemed to enjoy fencing with the protesters. Casting himself as a poverty crusader, he claimed the protesters were hurting the world's most impoverished citizens and threatening to retard economic growth with their demands for restrictions on fossil fuel use. "It is important that we don't jeopardize the opportunity for people around the world, particularly those currently at the lowest levels, to have access to the most basic needs -- such as decent housing, clean water, and rudimentary education -- and then to ultimately improve their standard of living," he told shareholders.
He dismissed calls for greater investment in renewable energies, arguing that the former Exxon had experimented with solar energy and other sources during the 1970s but failed to make a decent profit. Until renewable energy is attractive financially, he said, it would remain relegated to the fringes of the market. He predicted a bright future for mineral deposits. "I've been in the oil and gas industry for almost 37 years and have seen many forecasts of doom fall wide of the mark," Raymond said. "What these commentators simply fail to understand is the critical importance of fossil fuel energy to the world's economic growth."
The ExxonMobil chieftain also used the meeting to tout new deep underwater drilling and emissions-reducing technologies, while refusing to link emissions to scientific claims of a warming planet. Pointing to a petition circulated by the Oregon Institute of Science and Medicine and signed by 17,100 scientists that disputed a link between climate change and fossil fuel use, Raymond insisted it was he, and not the protesters, who kept an open mind on the issue of global warming. "We're going to follow the science," he said. "We're not going to follow what's politically correct."
The meeting shined light on other manifestations of controversy at ExxonMobil, perhaps inevitable considering the immense size of the company. Gay rights advocates, while not a formal part of the Campaign ExxonMobil, were present to protest the company's lack of a specific clause in their anti-discrimination policy protecting workers on the basis of sexual orientation, as well as the company's lack of domestic-partner benefits. Even some of the clergy present put on "Equality Project" stickers to support the cause. Crosby calls the issue a civil rights "no-brainer."
And human-rights advocates present blasted the company for a proposed $8 billion drilling and pipeline project in the landlocked sub-Saharan African nation of Chad, the world's fifth-poorest nation, and neighboring Cameroon. ExxonMobil and several European officials say the project is a boon to help the desperate nation fund education and health initiatives without charity or foreign aid, and the World Bank on Tuesday approved $365 million in loans to help Chad and Cameroon invest in the project.
But Amnesty International, the Sierra Club, and other groups fear a climate of intimidation as governments, eager to reap a windfall of petro-dollars, silence environmentalists and other dissenters. Reportedly, Chadian security forces have killed 200 unarmed civilians in the Doba oil region. Despite promises from ExxonMobil and government officials, activists also fear that corrupt leaders will pocket oil profits and not use the cash for development. "Neither country has a track record of using money to help the people of the country," says Sister Dolores Brooks, a Dominican nun and human-rights activist.
Despite their critical stance toward ExxonMobil, the religious leaders don't take a rigid anti-corporate stance. They frequently speak of ExxonMobil in possessive terms ("our" company) and insist they want the company to continue to succeed financially. After all, their retirements are counting on it. A flier distributed outside the Meyerson center read: "Attention ExxonMobil shareholders: Use your vote to protect your investments, human rights, and the environment!"
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