WionDrive News Desk 
CalPERS, the largest U.S. public pension fund, declared its intention to vote against all Exxon Mobil board members at the upcoming May 29 annual meeting, citing the oil giant’s legal action against activist investors.
Exxon, often facing critical shareholder resolutions, sued earlier this year to block a climate proposal vote submitted by two small activist investors, bypassing the usual regulatory process.
Despite the investors withdrawing their resolution, Exxon persisted with the lawsuit, seeking legal costs and other relief. CalPERS, with $490 billion in assets, stated the legal action could undermine investor rights.
Its vote is “more than symbolic”, even though there is no alternative slate of directors, CalPERS CEO Marcie Frost told reporters. She aimed to send a message to the board that “if they don’t want to do the governance they should step aside,” Frost said according to Reuters.
Exxon said in a statement its “efforts are intended to get clarity on the rules to foster an environment for open and meaningful shareholder dialogue.”
The company added it had engaged with CalPERS, which it considered had made a “poor fiduciary decision.”
CalPERS’ stake in Exxon Mobil stands at 8.45 million shares, accounting for approximately 0.19% ownership, based on LSEG data. The pension fund has wielded significant influence in previous director elections, notably supporting a successful board challenge in 2021 aimed at better positioning the company for the energy transition.
According to CalPERS’ Chief Investment Officer Marcie Frost, she had spoken with Exxon CEO Darren Woods, and as of now, the litigation against the activist investors appeared to be moving forward.
While activist groups have long urged CalPERS to divest from Exxon, Frost clarified the distinction between engaging with the company to request changes in its climate policy and encouraging it to withdraw the lawsuit against the activist investors.
“I want to keep our attention on the shareholder aspects of Exxon’s decision,” she said. “The problem with divestment when you are CalPERS is you completely lose your voice.”
Proxy adviser Glass Lewis recommended shareholders vote against re-electing Exxon’s lead independent director, citing what it called the firm’s “unusual and aggressive tactics”.
But Exxon has won support from business lobby groups, the U.S. Chamber of Commerce and Business Roundtable, which said the case “exemplifies activist groups’ takeover of the shareholder proposal process to score ideological points”.
