CalPERS to Oppose Appointment of ExxonMobil Board of Directors

The California Public Employees’ Retirement System announced on Monday that it would vote against the appointment of ExxonMobil’s 12-member board of directors and its CEO at the company’s shareholder meeting on May 29.

Earlier this year, ExxonMobil filed a lawsuit against two shareholders, Arjun Capital and Follow This, who had previously filed a proxy resolution for ExxonMobil to seek additional actions on climate change. In a press release, CalPERS CEO Marcie Frost and CalPERS Board of Administration President Theresa Taylor accused the company of intimidation tactics against shareholders.

“For almost four decades, CalPERS has used its investments in major corporations to hold shareholder-elected directors and top officials accountable. We believe this is key to how we ensure long-term, sustainable investment returns for more than 2 million members. We do so, in part, by asking company leaders tough questions and, in some cases, demanding action through our support for various shareholder proposals. We cast thousands of votes every year,” a CalPERS press release stated.

A shareholder proposal from Mercy Investment Services Inc. and Wespath Benefits and Investments filed on April 18 called for shareholders to reject the appointment of the board and the ExxonMobil CEO. Last week, California Treasurer Fiona Ma urged the state’s largest pension funds, CalPERS and the California Teachers’ Retirement System, to cast their votes against ExxonMobil.

A CalSTRS spokesperson said that the fund is still determining how it will vote at Exxon’s upcoming shareholder meeting. “We are disappointed that Exxon has continued in its lawsuit against Arjuna Capital and Follow This to exclude a shareholder proposal on this year’s proxy. We believe the SEC’s no-action process is an established and superior process, and do not support the use of shareholder capital to attack shareholder rights. In determining our vote, we will be thoughtful and deliberate knowing there are several factors to consider including our stewardship priorities, engagement with the company, and long-term ramifications of the lawsuit,” The spokesperson said.

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According to CalPERS 13F filing for Q1 2024, the fund held 8.5 million shares of ExxonMobil, worth roughly $983 million. CalPERS, the largest pension fund in the U.S., has $495.3 billion in assets under management, as of the first quarter of 2024.