Energy

Major Investment Firm Harangues Exxon On Climate Policies

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Chris White Tech Reporter
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One of the largest investment funds in the U.S. intends on pushing and prodding energy companies like ExxonMobil into disclosing how man-made global warming could affect their business.

Vanguard Group, a mutual fund that manages more than $4 trillion, is pushing to pass several shareholder resolutions on climate change at big energy firms. The group argues that the mission is based on economics, not ideology, even though the decision was made after investor complaints.

The fund has historically shied away from pushing companies on accepting climate policies, but Vanguard’s investment stewardship officer told reporters Monday that the shareholders have supposedly evolved on the issue.

“Our support for these proposals is not a matter of ideology, it’s a matter of economics,” said Glenn Booraem, who oversees the group’s corporate governance program. “To the extent there are significant risks to a company’s long-term value proposition, we want to make sure there is long-term disclosure of those risks to the market.”

Vanguard floated a proposal earlier this year forcing Exxon to measure how regulations effect the company’s oil assets. The measure is receiving intense scrutiny from shareholders who worry Exxon could get wobbly-kneed in the face of the environmentalist push.

Some analysts believe the push shows how powerful investors and money managers have on energy companies. Exxon opposed the measure, but shareholders supported the resolution during a financial meeting in May.

More than 60 percent of investors voted in support of the proposal — a similar proposal gained 38 percent support last year.

Jeff Woodbury, the company’s vice president, wrote several letters to shareholders Tuesday suggesting that “the corporation agrees with the underlying objective – we just have a different view on the best means to achieve it.”

Vanguard’s new-found mission prompted climate activist-centered firm Walden Asset Management of Boston to withdraw a proposal requesting a review of Vanguard’s proxy voting system, which hashes out Vanguard’s corporate structure.

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