Exxon CEO promises to sue more activist shareholders if they ‘abuse’ proxy rules

Exxon Mobil (NYSE:XOM) will continue to sue activist investors if they “abuse” the proxy voting process, CEO Darren Woods said Tuesday, following the company’s earlier lawsuit against Follow This and Arjuna Capital after the activists had filed a climate-related resolution for the company’s annual meeting in May.

A judge wound up dismissing the lawsuit in June, but only after the defendants withdrew their resolution and promised not to resubmit a similar one or help others do so.

“We think the process was being abused to the detriment of the rest of the shareholders,” and activists are using shareholder resolutions as “Trojan horses” to “drive us out of business,” Woods said at a Council of Institutional Investors conference in New York.

Woods faced skeptics in the audience, including fund managers who said they had voted against Woods and other Exxon (XOM) directors at the annual meeting in May because of the lawsuit, but Woods and other Exxon directors were easily re-elected with backing from big investors BlackRock and Vanguard.

Exxon (XOM) also is involved in a long arbitration battle with Chevron and Hess over the latter’s 30% stake in its Guyana oil project; at the conference, Woods disagreed with claims Exxon is being “unusually aggressive” in both the arbitration and shareholder activist cases.

“There’s a set of rules that have been put in place across both of those examples,” the CEO said. “We’re simply trying to follow those processes as they’ve been laid out.”

Front-month Nymex crude (CL1:COM) for October delivery closed Tuesday -4.3% to $65.75/bbl, and front-month November Brent (CO1:COM) finished -3.7% to $69.19/bbl, the lowest settlement value for both benchmarks since December 1, 2021.

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Oil futures fell for the eighth time in 10 sessions, as weak Chinese import data and a slight reduction in OPEC’s demand outlook added to jitters in an already bearish market.

“Crude oil demand destruction one-two punch from China and OPEC delivered the knockout blow today,” Mizuho’s Robert Yawger said, according to Dow Jones. “Incredibly, the market is getting beat down while a tropical storm/hurricane churns up the U.S. Gulf of Mexico oil patch.”

The EIA cut its oil price estimates for Q4 and FY 2025, but still expects benchmark crude to rebound from the recent selloff, foreseeing larger draws on global inventories through early next year.