NY pension fund boss Dinapoli vows to fight on against Exxon
US oil company ‘has to change’ if it wants to stay in business in the long-term
The head of one of America’s biggest pension funds has vowed not to back down in his fight to force Exxonmobil to do more to combat climate change.
“We’re going to keep the pressure on Exxon,” said Thomas Dinapoli, the New York state comptroller who is responsible for the $210bn New York State Common Retirement Fund. He told Ftfm: “If they want to stay in business long-term they need to change how they’re doing things.”
In April the Securities and Exchange Commission, the US regulator, upheld Exxon’s request that a proposition — that it should set targets for cutting greenhouse gas emissions — be kept off the ballot at its annual meeting on Wednesday.
Exxon, the country’s largest listed oil group, said it was already cutting emissions. It said the proposal backed by the New York fund and the Church Commissioners for England was an attempt to “micromanage the company”.
Mr Dinapoli said Exxon’s resistance was “very disheartening” but he added: “It doesn’t discourage us. We will keep coming back.”
The state of New York and the Church of England are backing renewed efforts to persuade the company to appoint an independent chairman, which they see as an alternative way to make the company do more about climate change.
They plan to oppose the appointment of the company’s board and have urged other shareholders to take “a strong voting stance”, which could include rejecting directors.
The proposal calling on Exxon to make the board chair an independent member was filed by the Kestrel Foundation.
Darren Woods is Exxon’s chief executive and chairman. Combining the roles is common in the US but separating them is regarded as better corporate governance.
Exxon’s “inadequate responses to climate change . . . reflect in significant part a board that is not functioning effectively in the absence of an independent chairman,” the church and New York pension fund said in a filing to the SEC.
The 2015 Paris agreement on climate change, which aims to keep the increase in global average temperature to below 2C when compared with pre-industrial levels, has galvanised investors to push investees to tackle climate change.
Royal Dutch Shell this year agreed to set carbon emissions targets and link these to executive pay after pressure from shareholders including the Church of England and Robeco, the Dutch asset manager.
BP has agreed to disclose how its spending plans, emissions policies and broader business strategy align with the Paris agreement.
US President Donald Trump has consistently shown scepticism about man-made climate change and has said he would pull the country out of the Paris agreement. His administration has focused on cutting environmental protection rules and exploring ways to revive the coal industry.
Mr Dinapoli, who praised Shell’s decision to link climate change action to executive pay, said the world was changing.
“Trump may give a sense of comfort. To me that’s not the reality,” he said. “The global economy is moving towards complying with Paris. We can’t be left out of that.”
He added: “The European energy companies get it. [Exxon] need to look to their peers.”