New York State Comptroller Thomas P. DiNapoli today announced that ExxonMobil has agreed to implement the shareholder request that the company analyze how worldwide efforts to adopt the Paris Agreement goals for reducing global warming might impact its business. The request, co-filed by the New York State Common Retirement Fund (the Fund) and the Church of England, received landslide support from more than 62 percent of Exxon voting shareholders at the company's annual meeting in May. As a result of the company's decision, the Fund will withdraw the shareholder proposal, which it refiled on Nov. 28, 2017.
"ExxonMobil's adoption of greater climate analysis is a win for shareholders and for the company's ability to manage risk," said New York State Comptroller Thomas P. DiNapoli. "I am pleased Exxon has agreed to undertake this important analysis. Climate change is one of the greatest threats to our pension fund's long-term value. Exxon's decision demonstrates that investors have the power to hold corporations accountable and to compel them to address our very real climate-related concerns. We will continue to monitor Exxon's response to climate change as we urge the company, and others in the energy sector, to find ways that they can adapt to the growing lower carbon economy."
The shareholder proposal asked Exxon to analyze how the Paris Agreement's goal of restricting global temperatures to no more than 2 degrees Celsius above pre-industrial levels will affect its business and to assess the financial risks associated with that 2-degree scenario.
While Exxon has previously recognized that changing regulations could reduce demand for its products and impact or delay its projects, it has not yet provided meaningful analysis of how the globally agreed upon 2-degree target will affect its position in the marketplace. Investors have a right to know how the company might be affected by, and respond to, a lower demand for fossil fuels due to changing regulations and restrictions.
DiNapoli and the Fund have filed the proposal at several other corporations and it has since been adopted by PPL Corporation and others.
Timeline of the NYS Common Retirement Fund's Engagement with Exxon
- Dec. 2015: The Fund and the Church of England first file their proposal with ExxonMobil.
- Jan. 2016: ExxonMobil seeks Securities and Exchange Commission approval to omit the proposal from consideration at its annual meeting.
- March 2016: The SEC rejects ExxonMobil's request.
- May 2016: Dozens of major institutional investors announce support for the Fund's proposal. May 25, 2016: At ExxonMobil's annual meeting, 38 percent of voting shareholders support the Fund's proposal.
- Nov. 2016: The Fund and the Church of England refile the proposal.
- May 31, 2017: 62.3 percent of ExxonMobil voting shares support the proposal.
About the NYS Common Retirement Fund
The New York State Common Retirement Fund is the third largest public pension fund in the United States with estimated assets of $201.3 billion as of Sept. 30, 2017. The Fund holds and invests the assets of the New York State and Local Retirement System on behalf of more than one million state and local government employees and retirees and their beneficiaries. The Fund has consistently been ranked as one of the best managed and best funded plans in the nation. The Fund's fiscal year ends March 31, 2018.