Page 11 - NorthAmOil Week 22 2021

NorthAmOil ENERGY TRANSITION NorthAmOil

Oil giants face setbacks from shareholders

over climate change

GLOBAL MAJOR oil companies have received sharp point for companies that are unprepared for the
rebukes over their handling of climate change in global energy transition,” said Aeisha Mastagni, a
a dramatic week for the oil industry last week. portfolio manager at CalSTRS, afterwards.
A small and new hedge fund, Engine No. 1, The move was vehemently opposed by Exx-
helped propel a move to replace three of Exxon- onMobil, which says it is responding appropri-
Mobil’s 12 board members with activist share- ately to the climate crisis.
holders to guide the company towards lowering “The events of today show definitively that
its carbon emissions and transitioning to cleaner many leaders in the oil and gas industry have a
energy. ExxonMobil’s preliminary voting results tin ear and do not understand that society’s views
saw two of Engine No. 1’s nominees elected, with and the legal and political environment in which
results for a third nominee initially considered they operate are changing radically,” Amy Myers The result
too close to call but subsequently confirmed. Jaffe, of Tufts University’s Fletcher School and
Meanwhile, that same day shareholders who has advised energy companies, told the Wall for Chevron
voted to tell rival Chevron to slash emissions, Street Journal after the ExxonMobil vote.
even those produced by customers who utilise For Chevron, around 61% of shareholders, illustrates Scope
its petrol. led by the Dutch campaign group Follow This,
These came as a court in the Netherlands voted to ask the super-major to cut emissions 3 emissions as
ordered Royal Dutch Shell to cut its carbon emis- including – importantly – Scope 3 emissions, being increasingly
sions sharply, by a net of 45% by 2030 compared those of customers that use its products.
with 2019 levels – that is, within just nine years, The result for Chevron illustrates Scope 3 in the spotlight.
a short period in terms of planning for a major emissions as being increasingly in the spotlight.
corporation. Shell says it will appeal, a process Indeed, oil companies’ carbon footprints are
that may take years. mostly a result of Scope 3 emissions. The pro-
Engine No. 1 is backed by major institutional posal passed by Chevron’s shareholders does not
investors including California Public Employ- define a precise timeline for reducing the com-
ees’ Retirement System, known as CalPERS, pany’s Scope 3 emissions, however, nor does it
the US’ largest pension fund, as well as the New impose any particular measures that Chevron
York State Common Retirement Fund and the must implement to reach this goal.
California State Teachers’ Retirement System Analysts have cautioned that even if change
(CalSTRS). Blackrock, the world’s largest asset is forced on the super-majors, there is no guar-
manager and ExxonMobil’s second-largest antee of how far-reaching it will be in practice.
shareholder, also joined the move. Nonetheless, environmentalists are hailing the
“It’s a historic vote that represents a tipping developments as a win.™

Week 22 03•June•2021 www. NEWSBASE .com P11