DALLAS (Reuters) - Exxon Mobil Corp <XOM.N> shareholders on Wednesday rejected a proposal by dissident investors, including Rockefeller family members, that urged Exxon to hire an independent chairman to lead its board.
By Michael Erman
DALLAS (Reuters) - Exxon Mobil Corp <XOM.N> shareholders on Wednesday rejected a proposal by dissident investors, including Rockefeller family members, that urged Exxon to hire an independent chairman to lead its board.
Over 60 percent of the shares voted at Exxon's annual meeting opposed the proposal recommending Exxon split its chairman and chief executive jobs, both of which are held by Rex Tillerson. Dissident shareholders have been critical of Exxon's lack of investment in alternative energy.
About 39.5 percent of the shares voted were in favor of the proposal, down from 40 percent last year.
!ADVERTISEMENT!Members of the Rockefeller family backed the call for change at the top of Exxon, closely tied to the family's vast fortune since John D. Rockefeller founded the Standard Oil Co, Exxon's precursor, in 1870, although no Rockefeller has served on the board of Exxon or of a predecessor company since 1911.
With oil hovering at around $130 a barrel and gas prices soaring, oil companies have become targets for criticism from lawmakers and consumer groups. They have also been targeted by environmentalists and shareholder activists who worry that the companies' promotion of fossil fuels will worsen global warming.
During the meeting, Tillerson made an effort to promote Exxon's environmental record, speaking at length about the company's efforts to lower its "environmental footprint."
Still, he made clear that Exxon's focus would stay true to its highly profitable past.
"Continuing to do everything we can to supply oil and natural gas is the core of our business. That's what we have been doing for 125 years and in my view we do it better than anyone else," Tillerson said at a press conference after the meeting.
"We're not going to abandon that when we know that is a requirement society has in the future," he said.
Exxon rival Chevron Corp <CVX.N> faced similar questions at its annual meeting on Wednesday in San Ramon, California, where shareholders and activists peppered the company with questions about its environmental and human rights record.
BOOM TO BUST?
Exxon recorded two of the largest-ever corporate profits in history in 2006 and 2007. Still, some shareholders have argued that the company's lack of investments in alternative energy could leave the world's largest publicly traded company behind its competitors.
Dissidents have also criticized the company for having a monolithic corporate culture, which prevents it from moving in new and innovative directions.
"Today's vote makes it clear that Exxon Mobil must respect the views of the shareholders and take account of the changing world outside the doors of its executive suite," Rockefeller family representatives Peter O'Neill and Neva Rockefeller Goodwin said in a statement.
"We are pleased to have played a role in sending a wake-up call to Exxon Mobil's management and its board of directors," they said.
Tillerson took the helm of the company at the beginning of 2006 and has steered a course similar to that set by his predecessor, the often combative Lee Raymond.
In Tillerson's first 9 quarters as CEO, Exxon has brought in around $91 billion in profits. The company has also raised its spending on oil and gas projects, but has not made any significant moves into renewable or alternative energy.
"Exxon Mobil's performance has been so strong that I think it was hard for a lot of mainstream investors to say that the current status quo hasn't been working well," said Howard Sherman, CEO of GovernanceMetrics International, a corporate governance ratings firm.
"Most large U.S. companies that have decided to separate the two positions do so either when there's a natural transition when the current chairman and CEO is retiring or even more often when there is some clear financial performance problem, or a question about the company's strategy."
Outside the meeting, a small group of about 20 protesters chanted slogans like "No more war for oil" and "Exxon: Enough!" But inside, many shareholders seemed content with the company's surging profits.
Investors rejected all 17 shareholder proposals at the annual meeting, which included seven proposals about the company's environmental policies and impact and three proposals on Exxon's executive compensation.
And while shareholders pressing the company to change its strategy dominated the meeting, others took the floor to defend the company.
"Some of our distinguished shareholder colleagues seem to have lost sight of why we hired you and why we elected this wonderful slate of directors, and that is to make us money," one investor told Tillerson.
"You've been quite successful at it."
(Additional reporting by Ed Stoddard in Dallas and Martha Graybow in New York; editing by Jeffrey Benkoe, Gary Hill)
