Exxon will have to be dragged screaming and kicking into the new era
Exxon, the world’s largest oil company after the state-owned Saudi Aramco and Sinopec, has taken two groups of company shareholders, the Netherlands’ Follow This and the US Arjuna Capital, to federal courts in Texas after they used a shareholders’ meeting to raise a proposal that the US company assume more responsibility for the greenhouse gas emissions generated by the end users of its products.
Yes, you read that right: a company suing its own shareholders. What is behind such madness, which would surely have Milton Friedman spinning in his grave? Shouldn’t the shareholders, the true owners of the company, be the ultimate authority in the governance of any company? Aren’t the managers, in fact, employees of the shareholders, there to do their bidding? What makes the managers of a company take legal action those whose interests are supposedly paramount?
Simple: Follow This and Arjuna Capital are activist shareholders, two groups that intend, through their investments in the company, to achieve a position that will force Exxon to change from within, and if not to force it to do so, which would obviously require a huge investment in order to obtain a position of control, and to generate a debate in its governing bodies, in particular at its shareholders’ meetings.
