Exxon’s lawsuit concerns shareholders advocating environmental and social change
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Shareholders who use resolutions to push companies on environmental and social matters are concerned that a lawsuit by Exxon Mobil, skipping the US securities regulator, might weaken their impact.
The Securities and Exchange Commission (SEC), led by President Biden’s appointees, has made it tougher for companies to block these resolutions from reaching a shareholder vote by appealing to the regulator.
Earlier this month, Exxon went around the SEC and filed a lawsuit against two shareholders who proposed a resolution asking the company to set new targets for cutting certain greenhouse gas emissions.
Exxon claimed in the lawsuit that these investors were misusing the process to promote their goal of reducing its fossil fuels business instead of enhancing shareholder value.
The oil giant also mentioned that a similar proposal was voted down by 90% of its shareholders last year.
Josh Zinner, CEO of the Interfaith Center on Corporate Responsibility (ICCR) said, “We’re concerned that this action could have a chilling effect, particularly on small investors who don’t have the resources to battle Exxon or other companies in the courts.” ICCR represents religious investors and other socially-aware asset managers.
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