ExxonMobil Corporation – Renewable Energy (2003 – 2004)
WHEREAS, in its 2002 proxy materials, ExxonMobil’s Board stated: “While renewable energy supplies are expanding, it is important to recognize that they are doing so from a very small base. ExxonMobil’s outlook for solar and wind energy indicates that even at a fairly optimistic growth rate of over 10 percent per year for 2000 to 2020, their share of the world’s energy mix in 2020 will still be less than 0.5 percent.”
Such projections are contradicted by other evidence:
1. The 15-nation European Union, the market for a large share of this company’s energy-output has set a goal of obtaining 22 percent of its electricity and 12 percent of all energy from renewable sources by 2010 (NYT 10/16/02);
2. Business Week calls wind-power “the fastest-growing game in the power business. Global wind capacity has nearly quadrupled in the past five years” (BW 03/03/03). It also notes that “solar power has also become a viable energy alternative” and “windmill generators now produce electricity as cheaply as cola units” (BW 06/02/03). In August, 2003 BW noted: “Deutsche Bank predicts global wind-power capacity will double in four years” (BW 08/11/03);
3. The Financial Times notes that “wind, waves, biomass, solar, hydropower and various hybrid schemes are now part of the currency of the power generation industry and legislation will ensure that they remain and prosper” (FT 04/03/03);
By its own admission, in its original effort to keep this resolution from being voted upon by the shareholders, ExxonMobil has stated that “renewable energy sources currently compose only an extremely insignificant percent of the company’s business.”
Meanwhile, as ExxonMobil continues to stress almost exclusively the development of fossil fuels, its major competitors (ChevronTexaco, BP, Royal Dutch Shell, Total Elf Fina) are making significant investments in renewable energy.
While ExxonMobil might be able to buy its way into renewable energy once it has no other choice, we question whether waiting until then will maximize shareholder value.
ExxonMobil’s position on global warming and renewable energy is putting the company at competitive disadvantage and risk for future litigation for failure to adequately plan for the future as well as reputational damage. “ExxonMobil’s stubborn refusal to acknowledge the fact that burning fossil fuels has a role in global warming is creating a PR backlash against the world’s biggest company” (O’Dwyer’s PR Weekly, 05/23/01);
RESOLVED: Shareholders request the independent members of the Board to oversee the preparation of a report to shareholders (at reasonable cost and omitting proprietary information) by September 1, 2004 outlining recommendations to management for promoting renewable energy sources and developing strategic plans to help bring renewable energy sources into ExxonMobil’s energy mix.
Supporting this resolution will indicate shareholder desire to emphasize greater diversification of ExxonMobil’s energy products through the development of more non-polluting energy sources. The energy future belongs to renewables, especially wind. This Company needs to be at the cutting edge of this development.