Dear ExxonMobil: I See A Bad Moon Rising (For You)

I see the bad moon a-rising
I see trouble on the way
I see earthquakes and lightnin’
I see bad times today
Don’t go around tonight
Well it’s bound to take your life
There’s a bad moon on the rise

Last month I wrote about how ExxonMobil had kindly invited its investors on a Magical Mystery Tour! Since I don’t own any shares in the company there was no room on the bus for me. Turns out that could be just as well. Events since then have raised some questions about where this tour is going to end up. Writing today I see a Bad Moon Rising for ExxonMobil’s management and board.

Silhouette of howling wolf against dark toned foggy background and full moon or Wolf in silhouette howling to the full moon. Halloween horror concept. | GETTY

ust to quickly refresh. The activist hedge fund Engine No. 1 has proposed an alternative slate of directors that includes four new, highly experienced people to join the ExxonMobil board. The fund sees this as necessary in order to correct years of financial underperformance by the company as it has obstinately resisted the necessary changes in its business model given the energy transition necessary to achieve the Paris Agreement of keeping global warming below 2.0°C (ideally 1.5°C). On May 6 The Coalition United for a Responsible Exxon (CURE), a group of institutional and private investors with a collective $2.5 trillion in assets under management, published a report analyzing the company’s poor performance which supports Engine No. 1’s analysis.

In the language of the proxy voting world, Engine No. 1 has proposed a White Proxy Card of eight existing directors and four new directors nominated by Engine No. 1. ExxonMobil is offering up its Blue Proxy Card consisting, not surprisingly, of its existing 12 director board.