Business & economy

ExxonMobil sues investors to block climate petition

ExxonMobil sues investors to block climate petition

Oil giant ExxonMobil has sued climate activist investors in a bid to prevent their climate proposal from going to a vote at its annual investor meeting.

The complaint is against Follow This and Arjuna Capital, which have called on Exxon to step up the pace of reductions in greenhouse gas emissions.

Exxon says the US and Dutch investors are driven by an “extreme agenda”.

It is rare for companies to go to court to block shareholder motions and this is the first time Exxon has done so.

If the Texas-based firm wins the case, it would have a significant impact on future shareholder petitions.

Listed firms usually debate the merits of individual proposals with the Securities and Exchange Commission (SEC).

But critics say the US financial regulator varies its advice depending on which administration is in office.

For example, the number of motions by environmental activists has risen significantly in recent years, according to the SEC.

Follow This and Arjuna Capital want Exxon to set so-called Scope 3 targets to reduce emissions produced by users of its oil and gas.

Exxon currently aims to reach net zero by 2050 for Scope 1 and Scope 2 emissions, which is the pollution from its production processes and the energy it consumes. However it is the only one of the five Western oil majors which does not have Scope 3 targets.

Exxon says the proposal by Follow This and Arjuna violates SEC rules for investor petitions.

The company has told the BBC that “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”.

Exxon is asking a judge in the US district court in Texas to exclude the Scope 3 proposal by in its proxy statement.

The firm has asked for a decision by 19 March, in time for its annual shareholder meeting on 29 March.

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