Norway's Oil Fund to Vote Against Exxon Mobil Amid Shareholder Rights Concern

By Dominic Chopping

The world's largest sovereign wealth fund will vote against the re-election of Exxon Mobil director Joseph Hooley, becoming the latest investor to oppose a move by the U.S. oil giant they say undermines shareholder rights.

Norges Bank Investment Management, the arm of Norway's central bank that manages the country's $1.6 trillion oil fund, has joined a growing list of shareholders to air their concerns over a lawsuit filed by Exxon Mobil against two sustainability investor groups.

The company sued Arjuna Capital and Follow This in January to block their shareholder proposal that would commit Exxon Mobil to further curb greenhouse-gas emissions.

The pair have since dropped the proposal and sought to have the lawsuit dismissed, but a Texas District Court judge ruled Wednesday that the case could continue against U.S. impact investor Arjuna Capital, while the suit against Dutch activist group Follow This was dropped over a lack of jurisdiction.

The oil fund holds a 1.4% stake in Exxon Mobil, placing it in the top 10 largest shareholders, and it said it will vote against the re-election of Joseph Hooley, lead independent director and chair of the nominating and governance committee.

"While we appreciate the significant value generated during Mr. Hooley's tenure as Lead Independent Director, Norges Bank Investment Management continues to place utmost importance on the protection of shareholder rights and raises concern around the potential impacts of litigation against shareholders stemming from the submission of a shareholder proposal," the oil fund said.

A group that includes several U.S. state treasurers and New York City Comptroller Brad Lander, said in a letter this week that it was calling on the world's largest asset managers to vote against executive chair and CEO Darren Woods and Hooley.

In the letter, which was submitted Tuesday to the U.S. Securities and Exchange Commission, the group said it believes that the oil company's attempts to undermine shareholder rights reflect a failure of board oversight and that it has wasted corporate assets on litigation.

The letter was also signed by a trustee of the United Steelworkers International Union Staff Pension Plan, a trustee of the AFL-CIO Staff Retirement Plan and three members of the California Public Employees' Retirement System board of administration. Earlier this week, Calpers, the nation's largest public pension manager, said it planned to vote against every Exxon Mobil board member.

"We're disappointed with Norges' decision, as it and other investors have clearly benefited from Mr. Hooley's leadership, which has helped drive more than more than $90 billion of earnings, $60 billion of shareholder distributions, and a nearly 23% total shareholder return over the past two years," an Exxon spokesperson said.

Stephen Nakrosis contributed to this article.

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

May 24, 2024 11:28 ET (15:28 GMT)

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