Exxon Mobil Corporation (NYSE:XOM) has no option but to put to vote a climate change proposal spearheaded by New York State’s comptroller at the upcoming shareholders meeting. The Securities and Exchange Commission made the ruling despite strong opposition from the oil giant.
Impact of Shareholders Vote
The agency on its ruling downplayed Exxon Mobil’s arguments that it already provides adequate carbon disclosures. According to the SEC, most of the reports the company says it has published don’t go far enough.
Exxon’s only way out of the current standoff is shareholders ruling in its favor at an upcoming AGM. Should shareholders approve the publishing of more carbon disclosures, then the company could be in more trouble. The firm will be forced to publish some of the risks that climate change or legislations designed to combat it could pose to its ability to generate profits in future.
The publishing of such reports is the last thing the oil giant needs at the moment. Such information could go a long in way in spooking potential investors, a situation the company wants to avoid. Even as the SEC pushes for a vote, Exxon Mobil still has an upper hand on getting its wish.
The company’s shareholders have been supportive so far having never approved any kind of climate change proposal. Last year they unanimously rejected the appointment of a climate change expert to the board. Given the stakes at hand, it will not come as a surprise if they vote against the New York State Comptroller report.
Ahead of the key vote, Exxon Mobil remains entangled in a series of carbon related battles. It is currently trying to clear its name over allegations it misled the public about the risks of climate change. New York Attorney General Eric Schneiderman, is spearheading the inquiry having pursued similar cases in the past.
After an eight-year investigation, he successfully settled a case involving Peabody Energy. The coal giant as part of the agreement is required to amend its climate change disclosures. Exxon Mobil on its part has hired Theodore Wells to defend its interest amidst Schneiderman advances.