HOUSTON, May 11 - Britain's biggest asset manager, Legal General, on Tuesday said it will vote for an activist hedge fund's board with the shareholders meeting later this month, fueling a pitched fight over the oil major's future.
Top US oil producer Engine No is battling the hedge fund Exxon.1 over four seats on its 12 members-in-a-house board and the direction of the company.The fund has criticized Exxon's poor returns, the expenditure on fossil fuels and the lack of clear plan for the transition of energy.
According to Refinitiv Data, Legal General Investment Management owns Exxon shares worth nearly $1 billion.It posted its voting plan in a blog on Tuesday.Exxon shareholders' meeting will be held on May 26.
LGIM also supported the reelection of Exxon CEO John Hoeppner and Independent Director Kenneth Frazier to the board and was linked in an interview with John Woods, head of U.S. Stewardship and Sustainable Investments at LGIM.
LGIM will vote for the engine 0 :Nominated's 1 - Alexander Karsner, Anders Runevad, Kaisa Hietala and Gregory Goff - he said.The engine number is No.The 1 slate also has a support from large pension funds in New York and California.
We think they have a good, complementary set of stories that would be in the best interest of the long-term shareholders, said Hoeppner.
Hoeppner said the current board of Exxon is full of incredibly accomplished CEOs but lacks people who understand oil and gas and energy transition, and who have overseen business transformation.
The company did not comment but pointed to a Monday letter to shareholders that said its directors bring valuable expertise in capital acquisition across industries, complex corporate transitions, energy industry, investor perspectives, Asian-Pacific markets and environmental, social and governance practices.
LGIM has spoken to the directors of Exxon very rarely if ever and has not found that its board offers the same level of board-level buy-in as we do in other organizations, Hoeppner said.
Woods voted against LGIM CEO and in favor of an independent chairman last year.It signed the Net Zero Asset Managers Initiative, which will be launched by 2050 or sooner to create net zero emissions for portfolio companies.
Exxon has not set a Net Zero target for 2050 as European peers have done.To address investor concerns over climate, it has increased its board in the last months, pledged to reduce spending on carbon initiatives and said that it would lower the intensity of its global oilfield greenhouse gases emissions.When and where can I get started, what can I do?