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Rockefellers Receive Boost in Exxon Fight


The Wall Street Journal: Rockefellers Receive Boost in Exxon Fight

May 9, 2008

Shareholder efforts to force Exxon Mobil Corp. to restructure and focus more on renewable energy got some backing from a favorable report by RiskMetrics Group, an influential firm that advises institutional investors.

RiskMetrics encouraged investors to back three proxy resolutions supported by descendants of John D. Rockefeller, who founded the oil company that became Exxon. Members of the wealthy Rockefeller family recently took the rare step of publicly criticizing the Irving, Texas, company, launching a campaign to recruit support for their position.

Independence Day?

RiskMetrics is recommending that shareholders approve a resolution calling for Exxon to name an independent chairman, separate from the chief-executive position, in a bid to shake up Exxon’s conservative management culture and encourage creative thinking about alternatives to fossil fuels. Rex Tillerson holds both positions.

Two other resolutions supported by RiskMetrics call for Exxon to set goals for reducing its greenhouse-gas emissions and to adopt a policy for boosting development of sources of renewable energy.

RiskMetrics isn’t supporting a fourth Rockefeller-backed resolution, which would require Exxon to report on how global warming will affect poor communities world-wide.

Exxon opposes all four resolutions.

The energy giant has notched record profits in the past year — and earned $10.89 billion in the first quarter of this year — as oil prices have soared past $100 a barrel. But the Rockefeller family and other dissident shareholders fear Exxon has focused too single-mindedly on extracting oil and natural gas, failing to plan for a future in which fossil fuel runs short, demand drops, or governments impose tough environmental regulations.

Mr. Tillerson has argued that fossil fuel will remain the world’s dominant energy source for at least two decades, with renewable energy accounting for barely 2% of supply by 2030. Exxon officials also have said that they are investing in next-generation research in hopes of creating more efficient and adaptable renewable technologies.

The RiskMetrics report, however, concludes that most of Exxon’s competitors — including Chevron Corp., Royal Dutch Shell PLC and British Petroleum PLC — have made greater commitments to renewable energy. “The company’s current policy on renewables … has led to substantial reputational damage for Exxon Mobil relative to its peers,” the report stated.

Shareholders have pushed Exxon on environmental and corporate-governance issues for the past several years. They haven’t won, but their support has steadily grown. In 2006, the call for an independent chairman got 34% support. In 2007, the same resolution won the backing of RiskMetrics, and support grew to 40% of shares cast.

Annual Meeting May 28

Backers are hoping the Rockefeller family’s campaign will push the resolutions over the top at this year’s annual meeting, on May 28. It isn’t known how many shares the family controls.

Of the remaining 15 resolutions in the proxy, RiskMetrics is recommending approval of three others opposed by Exxon, including ones to require it to report twice a year on political contributions made with corporate funds, and let shareholders cast advisory votes on the compensation of top executives.

Write to Stephanie Simon at [email protected] and its also non-profit sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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