ExxonMobil Proxy Fight Seems Motivated By Too Much Success

Core Viewpoint - ExxonMobil's CEO Darren Woods and lead independent director Joseph Hooley are facing opposition from activist investors despite the company achieving record profits, stock performance, and market capitalization following a $60 billion acquisition of Pioneer Natural Resources [1]. Group 1: Activist Investor Actions - The California pension system (CalPERS), New York State Common Retirement Fund, and other activist investor networks are mobilizing to oppose the re-election of Woods and Hooley, with CalPERS planning to oppose all 12 board members [2]. - Complaints from these investors stem from Exxon's decision to sue activist shareholders Arjuna Capital and Follow This, arguing that their proposals have been previously rejected and that the lawsuit is a waste of resources [2]. Group 2: Proxy Advisory Firm Involvement - Proxy advisory firm Glass Lewis has recommended that shareholders oppose Hooley due to Exxon's "unusual and aggressive tactics" in its lawsuit against activist shareholders [3]. - Exxon has responded to Glass Lewis, requesting a change in their recommendation and disclosure of their conflicts of interest related to activist networks [3][4]. Group 3: Company Performance and Defense - Exxon defends its board, highlighting that it has overseen over $90 billion in earnings and more than $60 billion in shareholder distributions, while planning to invest over $20 billion in lower-emissions opportunities through 2027 [4]. - Louisiana Treasurer John Fleming supports the re-election of Woods and Hooley, criticizing the activist investors for attempting to disrupt the company for political reasons, which he believes could threaten financial market stability [4]. Group 4: Underlying Motivations - The situation reflects an effort by pension managers from states that restrict oil and gas activities, along with activist investors, to penalize Woods and Hooley for their success in the oil and gas sector [5]. - The irony lies in the fact that by prioritizing oil and gas investments to maximize returns, Woods and Hooley have become targets for investors favoring alternative priorities [5].