Business

Column: Exxon Mobil is suing its shareholders to silence them about global warming

Published

2 years ago

May 14, 2024

Column: Exxon Mobil is suing its shareholders to silence them about global warming

You wouldn’t think that Exxon Mobil has to worry much about being harried by a couple of shareholder groups owning a few thousand dollars worth of shares between them — not with its $529-billion market value and its stature as the world’s biggest oil company.

But then you might not have factored in the company’s stature as the world’s biggest corporate bully.

In February, Exxon Mobil sued the U.S. investment firm Arjuna Capital and Netherlands-based green shareholder firm Follow This to keep a shareholder resolution they sponsored from appearing on the agenda of its May 29 annual meeting. The resolution urged Exxon Mobil to work harder to reduce the greenhouse gas emissions of its products.

Exxon has more resources than just about anybody; ‘overkill’ doesn’t begin to describe the imbalance of power.

— Shareholder advocate Nell Minow

The company’s legal threat worked: Days after the lawsuit was filed, the shareholder groups, weighing their relative strength against an oil behemoth, withdrew the proposal and pledged not to refile it in the future.

Yet even though the proposal no longer exists, the company is still pursuing the lawsuit, running up its own and its adversaries’ legal bills. Its goal isn’t hard to fathom.

“What purpose does this have other than sending a chill down the spines of other investors to keep them from speaking up and filing resolutions?” asks Illinois State Treasurer Michael W. Frerichs, who oversees public investment portfolios, including the state’s retirement and college savings funds, worth more than $35 billion.

In response to the lawsuit, Frerichs has urged Exxon Mobil shareholders to vote against the reelection to the board of Chairman and Chief Executive Darren W. Woods and lead independent director Joseph L. Hooley at the annual meeting.

He’s not alone. The $496-billion California Public Employees’ Retirement System, or CalPERS, the nation’s largest public pension fund, is considering a vote against Woods, according to the fund’s chief operating investment officer, Michael Cohen.

“Exxon has gone well beyond any other company that we’re aware of in terms of suing shareholders for trying to bring forward a proposal,” Cohen told the Financial Times. “There doesn’t seem to be anything other than an agenda of sending a message of shutting down shareholders’ ability to speak their mind.”

California Treasurer Fiona Ma, a CalPERS board member, backs a vote against Woods. “As the largest public pension fund in the country, we have a responsibility to lead on issues that threaten to undermine shareowners,” she says.

The proxy advisory firm Glass Lewis & Co., which helps institutional investors decide how to vote on shareholder proposals and board elections, has counseled a vote against Hooley, citing Exxon Mobil’s “unusual and aggressive tactics” in fighting activist investors.

Exxon Mobil’s action against Arjuna and Follow This opens a new chapter in the long battle between corporate managements and shareholder gadflies.

Fossil fuel companies have been especially touchy about shareholder resolutions calling on them to take firmer action on global warming and to be more transparent about the effects their products have on climate.

In part that may be the result of some significant victories by activist shareholders. In 2021, nearly 61% of Chevron shareholders voted for the company to “substantially” reduce its greenhouse gas emissions — a shockingly large majority for a shareholder vote on any issue. That same year, the activist hedge fund Engine No. 1 led a campaign that unseated three Exxon Mobil board members and replaced them with directors more sensitive to climate risk.

Exxon Mobil also subjected the San Diego County community of Imperial Beach to a campaign of legal harassment over the city’s participation in a lawsuit aimed at forcing the company and others in the oil industry to pay compensation for the cost of global warming, which stems from the burning of the companies’ products.

Even in that context, Exxon Mobil’s campaign against Arjuna and Follow This represents a high-water mark in corporate cynicism.

The lawsuit asserts that the investment funds’ proposed resolution violated standards set forth by the Securities and Exchange Commission governing the propriety of such resolutions — it was related to “the company’s ordinary business operations” and closely resembled resolutions on similar topics that had failed to exceed threshold votes at the company’s 2022 and 2023 annual meetings. Both standards allow a company to block a resolution from the meeting agenda, or proxy.

That may be so, but the conventional practice is for managements to seek approval from the SEC to exclude such resolutions through the issuance of what’s known as an agency “no action” letter.

Exxon Mobil hasn’t taken that step. Instead, it filed its lawsuit in federal court in Forth Worth, where the case was certain to be heard by one of the only two judges in that courthouse, both conservatives appointed by Republican presidents — a crystalline example of partisan “judge shopping.” The case came before Trump appointee Mark T. Pittman, who has allowed it to proceed.

The company hasn’t said why it followed that course. “The U.S. system for shareholder access is the best in the world,” company spokeswoman Elise Otten told me by email. “To make sure it stays that way, the rules must be enforced or the abuse by activists masquerading as shareholders will continue threatening the system.”

In practice, however, the SEC has been quite strict about requiring that shareholder proposals meet its standards. “There can only be one reason” for the lawsuit, says shareholder advocate Nell Minow — “it’s to crush the shareholder. Exxon has more resources than just about anybody; ‘overkill’ doesn’t begin to describe the imbalance of power.”

The company accused Arjuna and Follow This of aiming not “to improve ExxonMobil’s business performance or increase shareholder value,” but of pursuing the goal of “disrupting ExxonMobil’s investments and development of fossil fuel assets and causing ExxonMobil to change its business model, regardless of the benefits, costs, or the world’s needs.”

The company maintained that the shareholder groups aimed to “force ExxonMobil to change the nature of its ordinary business or to go out of business entirely.”

That’s flatly untrue. The resolution observed that the company’s “cost of capital may substantially increase if it fails to control transition risks by significantly reducing absolute emissions.”

That judgment is shared by many institutional investors and government regulators, and points to a path for preserving Exxon Mobil’s business prospects, not destroying them.

In any case, what Exxon Mobil failed to note is that shareholder resolutions are always advisory — they can’t require management to do anything.

In its lawsuit, the company whined about the sheer burden of handling an increase in shareholder resolutions, especially those on fraught topics such as the environment and social issues. Using what it described as an SEC estimate that it costs corporations $150,000 to deal with every submitted resolution, its annual meeting statement calculated that it has spent $21 million to manage 140 submitted resolutions.

A couple of points about that. First, the SEC didn’t estimate that every resolution costs $150,000 to manage. The SEC actually cites a range of $20,000 to $150,000 each.

Second, a quick look at the company’s financial statements gives the lie to its claim that shareholder resolutions are some sort of cataclysmic burden. Its statistics applied to the entire 10-year period from 2014 through 2023, not just a single year.

Over that decade, Exxon Mobil reported total profits of $204.3 billion. In other words, processing those 140 proposals — using the SEC’s highest estimate to arrive at $21 million — cost Exxon Mobil one one-hundredth of a percent of its profits, at most, to deal with shareholder proposals.

And it’s not as if those proposals clog up the annual meeting proxy — for this year’s meeting, only four proposals will be submitted to shareholder votes. Management opposes all four, big surprise.

As for whether companies such as Exxon Mobil have better uses for their money, the proxy statement doesn’t make a great case for every expenditure.

Last year, for instance, the company paid nearly $1.5 million in relocation expenses for its top executives, including about $500,000 for Woods, in connection with the move of its headquarters from the Dallas suburbs to the Houston suburbs, about a three-hour drive away. Over the last three years, Woods collected more than $81 million in compensation, so one can see why moving house would leave him strapped.

“As a shareholder, the one thing you ask for is to look at every expenditure in terms of its return on investment,” Minow told me. “It’s unfathomable that the return on investment of this lawsuit is in any way beneficial to the company.” She’s right: It’s certain that Exxon’s legal fees on this case already exceed the putative $150,000 expense it incurred dealing with the withdrawn proposal.

Exxon Mobil’s punitive lawsuit only hints at the lengths that the fossil fuel industry will go to preserve a business model facing an inexorable decline. The companies haven’t been shy about enlisting politicians to rid them of their turbulent shareholders (to paraphrase the medieval King Henry II).

In February, Sen. Bill Hagerty (R-Tenn.) introduced a measure dubbed the “Rejecting Extremist Shareholder Proposals that Inhibit and Thwart Enterprise for Businesses Act, or “RESPITE.” The act would overturn an SEC rule stating that resolutions dealing with “significant social policy issues” can’t be excluded from the annual proxy under the traditional “ordinary business” limitation.

Don’t expect them to be shy about demanding more latitude from a reelected President Trump. The Washington Post reported last week that Trump pledged to roll back Biden administration environmental policies if the oil executives meeting with him at Mar-a-Lago would raise $1 billion for his campaign. An Exxon Mobil executive was present, the Post reported.

Business

They graduated from Stanford. Due to AI, they can’t find a job

Published

9 hours ago

December 19, 2025

Press Room

They graduated from Stanford. Due to AI, they can’t find a job

A Stanford software engineering degree used to be a golden ticket. Artificial intelligence has devalued it to bronze, recent graduates say.

The elite students are shocked by the lack of job offers as they finish studies at what is often ranked as the top university in America.

When they were freshmen, ChatGPT hadn’t yet been released upon the world. Today, AI can code better than most humans.

Top tech companies just don’t need as many fresh graduates.

“Stanford computer science graduates are struggling to find entry-level jobs” with the most prominent tech brands, said Jan Liphardt, associate professor of bioengineering at Stanford University. “I think that’s crazy.”

While the rapidly advancing coding capabilities of generative AI have made experienced engineers more productive, they have also hobbled the job prospects of early-career software engineers.

Stanford students describe a suddenly skewed job market, where just a small slice of graduates — those considered “cracked engineers” who already have thick resumes building products and doing research — are getting the few good jobs, leaving everyone else to fight for scraps.

“There’s definitely a very dreary mood on campus,” said a recent computer science graduate who asked not to be named so they could speak freely. “People [who are] job hunting are very stressed out, and it’s very hard for them to actually secure jobs.”

The shake-up is being felt across California colleges, including UC Berkeley, USC and others. The job search has been even tougher for those with less prestigious degrees.

Eylul Akgul graduated last year with a degree in computer science from Loyola Marymount University. She wasn’t getting offers, so she went home to Turkey and got some experience at a startup. In May, she returned to the U.S., and still, she was “ghosted” by hundreds of employers.

“The industry for programmers is getting very oversaturated,” Akgul said.

The engineers’ most significant competitor is getting stronger by the day. When ChatGPT launched in 2022, it could only code for 30 seconds at a time. Today’s AI agents can code for hours, and do basic programming faster with fewer mistakes.

Data suggests that even though AI startups like OpenAI and Anthropic are hiring many people, it is not offsetting the decline in hiring elsewhere. Employment for specific groups, such as early-career software developers between the ages of 22 and 25 has declined by nearly 20% from its peak in late 2022, according to a Stanford study.

It wasn’t just software engineers, but also customer service and accounting jobs that were highly exposed to competition from AI. The Stanford study estimated that entry-level hiring for AI-exposed jobs declined 13% relative to less-exposed jobs such as nursing.

In the Los Angeles region, another study estimated that close to 200,000 jobs are exposed. Around 40% of tasks done by call center workers, editors and personal finance experts could be automated and done by AI, according to an AI Exposure Index curated by resume builder MyPerfectResume.

Many tech startups and titans have not been shy about broadcasting that they are cutting back on hiring plans as AI allows them to do more programming with fewer people.

Anthropic Chief Executive Dario Amodei said that 70% to 90% of the code for some products at his company is written by his company’s AI, called Claude. In May, he predicted that AI’s capabilities will increase until close to 50% of all entry-level white-collar jobs might be wiped out in five years.

A common sentiment from hiring managers is that where they previously needed ten engineers, they now only need “two skilled engineers and one of these LLM-based agents,” which can be just as productive, said Nenad Medvidović, a computer science professor at the University of Southern California.

“We don’t need the junior developers anymore,” said Amr Awadallah, CEO of Vectara, a Palo Alto-based AI startup. “The AI now can code better than the average junior developer that comes out of the best schools out there.”

To be sure, AI is still a long way from causing the extinction of software engineers. As AI handles structured, repetitive tasks, human engineers’ jobs are shifting toward oversight.

Today’s AIs are powerful but “jagged,” meaning they can excel at certain math problems yet still fail basic logic tests and aren’t consistent. One study found that AI tools made experienced developers 19% slower at work, as they spent more time reviewing code and fixing errors.

Students should focus on learning how to manage and check the work of AI as well as getting experience working with it, said John David N. Dionisio, a computer science professor at LMU.

Stanford students say they are arriving at the job market and finding a split in the road; capable AI engineers can find jobs, but basic, old-school computer science jobs are disappearing.

As they hit this surprise speed bump, some students are lowering their standards and joining companies they wouldn’t have considered before. Some are creating their own startups. A large group of frustrated grads are deciding to continue their studies to beef up their resumes and add more skills needed to compete with AI.

“If you look at the enrollment numbers in the past two years, they’ve skyrocketed for people wanting to do a fifth-year master’s,” the Stanford graduate said. “It’s a whole other year, a whole other cycle to do recruiting. I would say, half of my friends are still on campus doing their fifth-year master’s.”

After four months of searching, LMU graduate Akgul finally landed a technical lead job at a software consultancy in Los Angeles. At her new job, she uses AI coding tools, but she feels like she has to do the work of three developers.

Universities and students will have to rethink their curricula and majors to ensure that their four years of study prepare them for a world with AI.

“That’s been a dramatic reversal from three years ago, when all of my undergraduate mentees found great jobs at the companies around us,” Stanford’s Liphardt said. “That has changed.”

Business

Disney+ to be part of a streaming bundle in Middle East

Published

21 hours ago

December 18, 2025

Press Room

Disney+ to be part of a streaming bundle in Middle East

Walt Disney Co. is expanding its presence in the Middle East, inking a deal with Saudi media conglomerate MBC Group and UAE firm Anghami to form a streaming bundle.

The bundle will allow customers in Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE to access a trio of streaming services — Disney+; MBC Group’s Shahid, which carries Arabic originals, live sports and events; and Anghami’s OSN+, which carries Arabic productions as well as Hollywood content.

The trio bundle costs AED89.99 per month, which is the price of two of the streaming services.

“This deal reflects a shared ambition between Disney+, Shahid and the MBC Group to shape the future of entertainment in the Middle East, a region that is seeing dynamic growth in the sector,” Karl Holmes, senior vice president and general manager of Disney+ EMEA, said in a statement.

Disney has already indicated it plans to grow in the Middle East.

Earlier this year, the company announced it would be building a new theme park in Abu Dhabi in partnership with local firm Miral, which would provide the capital, construction resources and operational oversight. Under the terms of the agreement, Disney would oversee the parks’ design, license its intellectual property and provide “operational expertise,” as well as collect a royalty.

Disney executives said at the time that the decision to build in the Middle East was a way to reach new audiences who were too far from the company’s current hubs in the U.S., Europe and Asia.

Business

Erewhon and others shut by fire set to reopen in Pacific Palisades mall

Published

1 day ago

December 18, 2025

Press Room

Erewhon and others shut by fire set to reopen in Pacific Palisades mall

Fancy grocer Erewhon will return to Pacific Palisades in an entirely rebuilt store, as the neighborhood’s luxury mall, owned by developer Rick Caruso, undergoes renovations for a reopening next August.

Palisades Village has been closed since the Jan. 7 wildfire destroyed much of the neighborhood. The outdoor mall survived the blaze but needed to be refurbished to eliminate contaminants that the fire could have spread, Caruso said.

The developer is spending $60 million to bring back Palisades Village, removing and replacing drywall from stores and restaurants. Dirt from the outdoor areas is also being replaced.

Demolition is complete and the tenants’ spaces are now being restored, Caruso said.

“It was not a requirement to do that from a scientific standpoint,” he said. “But it was important to me to be able to tell guests that the property is safe and clean.”

Erewhon’s store was taken down to the studs and is being reconfigured with a larger outdoor seating area for dining and events.

When it opens its doors sometime next year, it will be the only grocer in the heart of the fire-ravaged neighborhood.

The announcement of Erewhon’s comeback marks a milestone in the recovery of Pacific Palisades and signals renewed investment in restoring essential neighborhood services and supporting the community’s long-term economic health, Caruso said.

A photograph of the exterior of Erewhon in Pacific Palisades in 2024.

(Kailyn Brown/Los Angeles Times)

“They are one of the sexiest supermarkets in the world now and they are in high demand,” he said. “Their committing to reopening is a big statement on the future of the Palisades and their belief that it’s going to be back stronger than ever.”

Caruso previously attributed the mall’s survival to the hard work of private firefighters and the fire-resistant materials used in the mall’s construction. The $200-million shopping and dining center opened in 2018 with a movie theater and a roster of upmarket tenants, including Erewhon.

“We’re honored to join the incredible effort underway at Palisades Village,” Erewhon Chief Executive Tony Antoci said in a statement. “Reopening is a meaningful way for us to contribute to the healing and renewal of this neighborhood.”

Erewhon has cultivated a following of shoppers who visit daily to grab a prepared meal or one of its celebrity-backed $20 smoothies.

The privately held company doesn’t share financial figures, but has said its all-day cafes occupy roughly 30% of its floor space and serve 100,000 customers each week.

Erewhon has also branched out beyond selling groceries.

Its fast-growing private-label line now includes Erewhon-branded apparel, bags, candles, nutritional supplements and bath and body products.

Erewhon will also open new stores in West Hollywood in February, in Glendale in May and at Caruso’s The Lakes at Thousand Oaks mall in July 2026.

About 90% of the tenants are expected to return to the mall when it reopens, Caruso said, including restaurants Angelini Ristorante & Bar and Hank’s. Local chef Nancy Silverton has agreed to move in with a new Italian steakhouse called Spacca Tutto.

In May, Pacific Palisades-based fashion designer Elyse Walker said she would reopen her eponymous store in Palisades Village after losing her 25-year flagship location on Antioch Street in the inferno.

Fashion designer Elyse Walker announced the reopening of her flagship store

“People who live in the Palisades don’t want to leave,” Walker said at the time. “It’s a magical place.”

Caruso carried on annual holiday traditions at Palisades Village this year, including the lighting of a 50-foot Christmas tree for hundreds of celebrants Dec. 5. On Sunday evening, leaders from the Chabad Jewish Community Center of Pacific Palisades gathered at the mall to light a towering menorah.

A total of 6,822 structures were destroyed in the Palisades fire, including more than 5,500 residences and 100 commercial businesses, according to the California Department of Forestry and Fire Protection.

Caruso said he hopes the shopping center’s revival will inspire residents to return. His investment “shows my belief that the community is coming back,” he said. “Next year is going to be huge.”