ExxonMobil loses third board seat to activist: Update

Adds results of shareholder proposals in final paragraphs.

An activist investor has won a third board seat at ExxonMobil, according to the latest vote count, dealing a fresh blow to the biggest US oil company.

Engine No 1 nominee Alexander Karsner, a former US assistant secretary of energy and strategist at X, Alphabet's innovation lab, will join his fellow shareholder dissidents — refining industry veteran Gregory Goff and renewables expert Kaisa Hietala — on the board.

The 12-member ExxonMobil board will now comprise of nine of the company's own nominees and three from the tiny hedge fund. The updated votes followed a bruising five-month proxy battle that reached its climax at last week's annual meeting.

The tally caps an ignominious defeat for ExxonMobil, which had urged shareholders to vote against the candidates proposed by the hedge fund, dismissing them as unqualified. That a relatively unknown investor, with a stake of just 0.02pc in the oil major, has ended up controlling a quarter of the board shows the extent of investor discontent around its climate change strategy.

ExxonMobil's chief executive Darren Woods said he is looking forward to working with all the directors to "build on the progress we've made to grow long-term shareholder value and succeed in a lower-carbon future."

Engine No 1 was able to capitalize on growing unease among investors over ExxonMobil's financial underperformance in recent years in relation to its peers, and also concern it was moving too slowly to address climate risks.

While the company started a low-carbon business earlier this year, set out modest emissions targets, and began the process of freshening up its board, these measures were seen as being too little and too late.

"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,'' Engine No 1 said.

A majority of shareholders also voted in favor of proposals requiring the company to release reports on its political lobbying and climate-related lobbying activities, both of which were opposed by the board.

A shareholder resolution to split the chief executive and chairman roles, both of which are held by Woods, was supported by 22.1pc of votes cast, down from a year ago.

The votes are still preliminary and need to be certified.

By Stephen Cunningham