Rockefellers urge Exxon to greener future

Age
Wednesday 21/5/2008 Page: 7

A SHAREHOLDER revolt at Exxon Mobil led by the billionaire Rockefeller family has won the support of some significant British institutional investors. F&C Asset Management, Morley Fund Management, the Co-operative Insurance Society, Universities Superannuation, Railpen Investments and the West Midlands Pension Fund are throwing their weight behind a resolution demanding that Exxon Mobil appoint an independent chairman.

The world's biggest oil company is facing a rebellion over its hardline approach to global warming. The company has refused to follow rival oil companies in committing largescale capital investment to environmentally friendly technology. Rockefeller ancestor John D. Rockefeller founded Standard Oil, the business at the core of Exxon Mobil.

His dynasty sponsored four shareholder resolutions. One of these calls on the chief executive, Rex Tillerson, to relinquish his role as chairman in favour of an outsider. The London based corporate governance advisory service Pirc will recommend that institutions support this proposal.

"Despite top-notch individual directors, the company's record over the last decade, particularly regarding climate change, demonstrates that debate has been lacking," said F&C Asset Management's Karina Litvack.

By bringing in an independent chairman, the company can better leverage that creativity and challenge, and avoid over dominance by management." Exxon maintains that green technologies are not viable. But critics fear that the company's reluctance to explore alternative energy will prove to be bad business judgement as rivals seek to capture public affection by rebranding themselves as environmentally sensitive enterprises.

The Rockefellers point out that Exxon has $US25 billion ($A26.2 billion) of capital investment planned in carbon-based fuel but its environmental commitment is centred on $US100 million to fund a Stanford University project on climate change. At last year's meeting, 40% of investors' votes were cast in favour of an independent chairman.

The result of this resolution is not binding on Exxon but the company has said that its board will reconsider any policy challenged by successful shareholder resolutions. Exxon says its board is better placed than investors to decide on the company's leadership structure.