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Exxon Shareholders Shake Up Board, Elect Nominees from Activist Hedge Fund

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   |    Thursday,May 27,2021

In a surprise move, ExxonMobil shareholders have elected two new directors that were nominated by rogue hedge fund Engine No. 1 to the oil giant's board of directors.

Engine No. 1 is a new firm that has quickly garnered popularity for its call that companies adopt a more well-founded approach to business, investing in local communities, workers and the environment.

Several shareholders, including BlackRock, one of Exxon's largest shareholders, have signaled support for the fledgling firm. According to the vote, BlackRock cast votes in favor of three of the four Engine No. 1 nominees.

Reports indicate that the board elections were tense. The Washington Post reports that incumbent Exxon directors were making numerous calls to shareholders in an attempt to change their votes prior to the close of voting.

Results

Shareholders have elected eight of ExxonMobil nominees to the board of directors and two of Engine No. 1 nominees. Vote results for five nominees were too close to call.

Re-elected ExxonMobil directors were Woods, Michael Angelakis, Susan Avery, Angela Braly, Ursula Burns, Kenneth Frazier, Joseph Hooley and Jeffrey Ubben.

Elected from Engine No. 1's nominees were Gregory Goff and Kaisa Hietala.

• Mr. Goff was Executive Vice Chairman of Marathon Petroleum Corporation, an integrated downstream energy company, until his retirement in 2019. He joined Marathon Petroleum in 2018 following its acquisition of Andeavor. Previously, he served as President and Chief Executive Officer (2010-2018) of Andeavor, a leading petroleum refining and marketing company formerly known as Tesoro Corp., and as its Chairman (2014-2018). Under his leadership, Andeavor generated total returns of over 1,200%, significantly outperforming the U.S. Energy sector’s total return of 55%. In 2018, Harvard Business Review named Mr. Goff one of the “Best-Performing CEOs in the World.” Prior to joining Andeavor, Mr. Goff had an almost 30-year career with ConocoPhillips, during which time he held various leadership positions in Exploration and Production, and Downstream, and most recently served as Senior Vice President of Commercial businesses from 2008 to 2010. He serves on the Board of Enbridge Inc. (NYSE: ENB), a Canadian energy infrastructure company, and Avient (formerly PolyOne Corporation), a U.S. polymer company. He is also the Founder of the Goff Strategic Leadership Center at the University of Utah David Eccles School of Business. Mr. Goff holds a BS and an MBA from the University of Utah.

• Kaisa Hietala is an Operating Executive focused on the oil & gas and renewable energy sectors. Ms. Hietala is an experienced business & sustainability executive helping companies to transform the challenges of environmental megatrends into business opportunities and growth. Until early 2019, she spent 20 years changing the oil industry from the inside. During her leadership, a start-up team in Neste Corporation transformed the oil refining company into the world’s largest and most profitable renewable products company. Ms. Hietala serves on the Boards of Smurfit Kappa Group, Kemira Corporation and Tracegrow. She earned a master's degree in Geophysics at the University of Oulu (Finland) and a master's degree in Environmental Studies at the University of Cambridge (UK).

Some Spots Still Pending

The outcome was not yet determined for ExxonMobil director candidates Steven Kandarian, Douglas Oberhelman, Samuel Palmisano and Wan Zulkiflee, and for Engine No. 1 candidate Alexander Karsner.

A fourth Engine No. 1 candidate, Anders Runevad, was not elected.

Shareholders Put Lobbying, Climate on Agenda

The board will reconsider two shareholder proposals that received majority shareholder approval, which include Item No. 9, calling for a report on lobbying, and Item No. 10, requesting a report on climate lobbying.

Exxon CEO Darren Woods said: "We welcome all of our new directors and look forward to working with them constructively and collectively on behalf of all shareholders.

"We've been actively engaging with shareholders and received positive feedback and support, particularly for our announcements relating to low-carbon solutions and progress in efforts to reduce costs and improve earnings. We heard from shareholders today about their desire to further these efforts, and we are well positioned to respond."