Action at oil & gas companies’ annual general meetings

Key takeaways:

– Shareholders’ activism is not new but in the energy industry, it is intensifying and has recently caused serious developments – some quite controversial (see for instance the latest legal clash between ExxonMobil and climate-focused shareholder groups).

– The impact of such activism on the course of a business is questionable (see Shell’s most recent annual general meeting (AGM) where shareholders overwhelmingly rejected a climate resolution filed by an activist group that called the oil major to align its medium-term carbon emissions reduction targets with the Paris Climate Agreement after the company weakened its 2030 climate related plans).

– However, research confirms that one of the beneficial outcomes of shareholders’ activism is encouraging companies to pursue greater disclosure – and thereby more transparency – with respect to their exposure to climate change risks.

– Still, while many investors support the climate cause, they are unlikely to want to see it pursued at the expense of poorer returns.