News Environment Exxon Loses (Again) to Activist Investors Activist firm Engine No. 1 has secured a third Exxon board seat. By Sami Grover Sami Grover Twitter Writer University of Hull University of Copenhagen Sami Grover is a writer and self-described “environmental do-gooder,” now advising community organizations. Learn about our editorial process Fact checked by Haley Mast Fact checked by Haley Mast on June 05, 2021 LinkedIn Harvard University Extension School Haley Mast is a writer, fact checker, and conservationist with a certification in sustainability. Learn about our fact checking process on June 5, 2021 08:02PM EDT Dean Mouhtaropoulos/Getty Images Share Twitter Pinterest Email News Environment Business & Policy Science Animals Home & Design Current Events Treehugger Voices When ExxonMobil-backed candidates lost “at least two” seats on the company’s Board of Directors to activist-backed alternatives, it’s fair to say it sent shockwaves across both the climate movement and the energy sector too. Now, activist firm Engine No. 1, which has a 0.02% stake in Exxon, claimed a third seat on the oil giant's 12-member board. Engine No. 1, which has been pushing Exxon to shift away from fossil fuels, nominated four directors ahead of the oil company's annual shareholder meeting in May. The activist firm secured two seats last month when Gregory J. Goff and Kaisa Hietala were elected. A Securities and Exchange Commission filing confirms Alexander Karsner, a senior strategist at Google's parent company Alphabet Inc., received a majority of votes from shareholders. The Washington Post reports that "Karsner placed 11th in a race for 12 board seats, about 1.2 percent ahead of two of ExxonMobil’s nominees." “We are grateful for shareholders’ careful consideration of our nominees and are excited that these three individuals will be working with the full board to help better position ExxonMobil for the long-term benefit of all shareholders,” said Engine No. 1 in a statement. Karsner's appointment means a full 25% of the Exxon board will now comprise of candidates who were voted in explicitly on a platform of demanding more climate action, more climate transparency, and a better plan for a transition away from fossil fuels. As if to hammer home that point, shareholders also approved non-binding resolutions supporting disclosure of the company’s climate- and political-lobbying efforts. “We look forward to working with all of our directors to build on the progress we’ve made to grow long-term shareholder value and succeed in a lower-carbon future,” Exxon Chairman and CEO Darren Woods said in a statement. It’s unlikely, however, that these victories will immediately result in dramatic scaling down of Exxon’s core business. After all, the candidates are all firmly from a mainstream business and energy background. Goff is a former refining industry executive and Hietala is the former vice president of renewables at Neste. Karsner was assistant secretary for energy efficiency and renewable energy at the Department of Energy under former President George W. Bush, reports The New York Times. He also worked for companies that built solar plants. Here’s how Engine No.1, the activist investor group credited with spearheading the rebellion, describes its goals: “The energy industry and the world are changing. To protect and enhance value for shareholders, we believe ExxonMobil must change as well. We believe that for ExxonMobil to avoid the fate of other once-iconic American companies, it must better position itself for long-term, sustainable value creation.” Clearly, investors are ready and hungry for, at the very least, diversification away from fossil fuels and more engagement with the transition toward a low carbon economy. As such, the next moves from Exxon may closely resemble the so-called "net-zero" plans of companies like Shell or BP—although those have also been slammed by activists as inadequate. Given that they were clearly not enough to stave off Shell’s defeat in Dutch courts on the same day as the coup at Exxon, we can expect the pressure to keep building on all carbon-intensive industries to start grappling seriously with their carbon-related risks.