Environmental activists have won a major victory as two board seats at oil giant Exxon Mobil (NYSE:XOM) have gone to Engine No. 1, a tiny firm focused on reducing carbon emissions around the world.
Activist investor Engine No. 1 won the two board seats following a historic battle over the oil giant’s board of directors, signaling investors’ support for greater disclosure from the company as the world shifts away from fossil fuels.
A vote on a third board seat at Exxon Mobil is still being decided, according to the company.
Engine No. 1, which has a 0.02% stake in Exxon Mobil, has been targeting the company since December of last year, pushing it to reconsider its role in a zero-carbon future.
Wednesday’s vote came during Exxon Mobil’s annual shareholder meeting, where executives fielded questions from shareholders on topics ranging from the company’s dividend to its investments in carbon capture technology.
The vote on the board seats follows months of back-and-forth between Engine No. 1 and Exxon Mobil. The activist firm nominated four independent director candidates and won support from large pension funds, including CalPERS and the New York State Common Retirement Fund.
Exxon Mobil’s management has emphasized the steps it is taking to solidify its role in a lower-carbon world, including allocating $3 billion U.S. for research around carbon capture and other emissions-cutting technologies.
The battle over Exxon’s board comes as the company’s stock has recovered from its pandemic lows. The shares are up more than 40% year-to-date and have gained 26% over the last year amid a recovery in oil prices and aggressive cost-cutting strategies.
Still, the stock has been cut nearly in half since its all-time high above $100 in January 2014, and last year the company was removed from the Dow Jones Industrial Average after nearly a century in the index.
Exxon swung to a profit during the first quarter of 2021 after four straight quarters of losses as the COVID-19 pandemic wreaked havoc on the oil and gas industry.