Blackrock and Fidelity defy Exxon on AGM climate vote

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Blackrock and Fidelity are reportedly among the majority at Exxon Mobil’s AGM that have voted for more disclosure on climate risk – in defiance of the oil major.

Sixty two per cent of shareholders voted in favour of the US company increasing its reporting around the risks of climate change to the business.

Exxon opposed the resolution, which required more transparency around how global policies focussed on keeping warming below 2 per cent will impact the oil major’s business.

The vote came the same afternoon that sources revealed Donald Trump plans to withdraw the US from the Paris Agreement, joining Syria and Nicaragua as the only non signatories.

Former Exxon Mobil chief executive Rex Tillerson is secretary of state in the Trump administration, but reportedly supports US remaining part of the global pact.

A further resolution calling for Exxon to detail how it is preventing methane emissions from hydraulic fracturing, or fracking, during well drilling did not pass with only 38 per cent of shareholders voting for it.

Last year Blackrock was accused of hypocrisy as it released a report touting its environmental credentials despite having voted at the 2016 Exxon AGM against better climate risk reporting. That vote ultimately failed to pass with 38 per cent of the vote.

In the lead up to this year’s vote, Exxon had lobbied shareholders, including Blackrock, Vanguard and Fidelity, before the AGM to reject the measure.

The vote marks a “step-change” in investor sentiment for climate engagement, according to ShareAction chief executive Catharine Howarth, but she warns that Exxon now must follow through with action.

“The 2015 resolutions at BP and Shell passed with close to 99 per cent support, yet both firms are still pursuing business strategies that take us towards a frightening 3 degrees of temperature growth.”

Alice Garton, corporate lawyer at ClientEarth, says Exxon risks further climate litigation if it does not act in line with the vote.

“Exxon’s reputation has had a rough ride over the last years, with lawsuits emerging over various climate-related matters.”