Landmark Agreement With Shareholders: ExxonMobil Agrees to Report on Climate
Change & Carbon Asset Risk
Withdrawal of Shareholder Proposal Seeking Disclosure on Stranded Carbon
Assets Leads to Agreement with Largest U.S. Oil and Gas Producer
NEW YORK, March 20, 2014
NEW YORK, March 20, 2014 /PRNewswire-USNewswire/ --In response to a
shareholder resolution, ExxonMobil (XOM) – the largest U.S. energy company,
for the first time ever has agreed to publish a Carbon Asset Risk report on
the Company website describing how it assesses the risk of stranded assets
from climate change. The report will provide investors with greater
transparency into how ExxonMobil plans for a future where market forces and
climate regulation makes at least some portion of its carbon reserves
Arjuna Capital, the sustainable wealth management platform of Baldwin Brothers
Inc., and As You Sow, a non-profit promoting environmental corporate
responsibility, have agreed to withdraw their shareholder resolution in
exchange for ExxonMobil providing information to shareholders on the risks
that stranded assets pose to the Company's business model, how the company is
planning for a carbon constrained world, how climate risks affect capital
expenditure plans, and other related issues.
"We're gratified that ExxonMobil has agreed to drop their opposition to our
proposal and address this very real risk. Shareholder value is at stake if
companies are not prepared for a low-carbon scenario," said Natasha Lamb,
director of equity research and shareholder engagement at Arjuna Capital.
"More and more unconventional 'frontier' assets are being booked on the
balance sheet, such as deep-water and tar sands. These reserves are not only
the most carbon intensive, risky, and expensive to extract, but the most
vulnerable to devaluation. As investors, we want to ensure our Companies'
capital will yield strong returns, and we are not throwing good money after
"That the largest American oil and gas company is the first to come to the
table on this issue says a lot about the direction that energy markets are
taking," said Danielle Fugere, President of As You Sow. "Companies need to
acknowledge that preparing for a low-carbon future is a necessity, not a
choice. Companies that prepare early for a future with reduced carbon
emissions will likely perform better than those who delay -- and investors
need transparency and disclosure about these company choices."
This is the first successful withdrawal with an oil and gas producer on the
carbon asset risk issue this proxy season. The proposal reflects increasing
investor concern about the issue of stranded assets and builds on a
shareholder initiative coordinated by Ceres, in which shareholders
representing $3 trillion in assets under management, asked 45 companies for
increased disclosure about whether they are addressing carbon-related risk,
the impact on capital expenditure decisions, and whether they are implementing
strategies to avoid stranded assets in a carbon constrained world. Carbon
Asset Risk proposals were filed at 10 fossil-fuel companies this year.
These proposals underline a growing awareness of carbon asset risk. World
governments agree that if catastrophic warming over 2°C is to be avoided, no
more than one-third of current proven carbon reserves can be burned. These
reserves, currently on the balance sheets of the 200 largest coal, oil, and
gas companies are valued at $20 trillion. Yet, a recent Unburnable Carbon
report calculates that in 2012 alone, the 200 largest publicly traded fossil
fuel companies collectively spent an estimated $674 billion on finding and
developing new reserves – reserves that cannot be utilized without breaking
the world's carbon budget.
ExxonMobil's agreement to report publicly on carbon asset risk is an important
step in addressing the likelihood that Exxon's reserves are at risk of
devaluation in a carbon-constrained future, and how the Company is responding
to the long-term financial risks climate change poses to its business plans.
"A careful and detailed assessment of the potential for stranded assets is an
important first step for all fossil fuel companies, and we're encouraged by
Exxon Mobil's commitment to publish this report," said Andrew Logan, Director
of Ceres' Oil and Gas Program. "Moving forward, Ceres and its Investor Network
on Climate Risk will be looking for concrete commitments by companies to avoid
making riskier investments in the most carbon-intensive assets, which would
demonstrate the companies' ability to adapt as the world transitions to a
This resolution and withdrawal with Exxon follows a first-of-its-kind proposal
and vote on the risk of stranded assets filed by As You Sow at CONSOL Energy
last year, which was supported by almost 20% of voting shares, representing
over $1 billion in assets. This level of shareholder support is rare for a new
resolution, demonstrating the depth of concern from large institutional
"Investors are the canary in the coalmine and will move their money to avoid
material risk," said Lamb. "Forward thinking companies need to re-assess how
they allocate shareholder capital and act strategically to shift their
business models. If Big Oil can't redirect capital to low carbon energy
alternatives, investors will. "
Arjuna Capital is the sustainable wealth management platform of Baldwin
Brothers Inc., an SEC-registered independent financial advisory firm
established in 1974. For more information visit www.arjuna-capital.com.
As You Sow is a nonprofit organization that promotes environmental and social
corporate responsibility through shareholder advocacy, coalition building, and
innovative legal strategies. For more information visit www.asyousow.org.
MEDIA CONTACT: Natasha Lamb, (978) 578-4123 or firstname.lastname@example.org; and
Danielle Fugere, (510) 735-8141 or email@example.com
SOURCE As You Sow, San Francisco; Arjuna Capital, New York City
Contact: Patrick Mitchell, (703) 276-3266 or firstname.lastname@example.org
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