ExxonMobil and Chevron Shareholders Pressure Companies to Come Clean on Fracking

May 30, 2012—At today’s annual meetings, ExxonMobil* and Chevron* shareholders demanded that the companies come clean on how fracking is impacting their bottom lines. Community opposition to and increased regulation of hydraulic fracturing, or fracking, is growing across the U.S. and around the world, which has direct ramifications for Chevron and ExxonMobil, given their size and reach.  

Shareholders voted 30%** for the ExxonMobil resolution and 27%** for the Chevron resolution, signaling meaningful support for disclosure from the companies on the risks this controversial method of natural gas production poses to their operations and finances. This level of support demonstrates real concern from large institutional investors.  

“While other companies are becoming more transparent in how they are managing the risks associated with fracking, ExxonMobil and Chevron are industry laggards when it comes to disclosure,” said Michael Passoff, Senior Strategist at As You Sow, a shareholder advocacy group that filed the ExxonMobil resolution on behalf of the Park Foundation. “It is time for these major oil and gas companies to take a hard look at how they are going to manage the inherent financial and environmental risks of their fracking practices.”  

Natural gas production from shale formations in the United States has grown dramatically in recent years, amidst expanding controversy over the impacts of fracking. Incidents of poorly constructed wells, equipment failures, degraded local and regional air quality, water contamination, lawsuits, strained community relations, and related government enforcement actions have contributed to calls for increased regulation and outright community opposition.

Just this month, Vermont became the first state to completely ban fracking. New York, New Jersey, and Maryland have all imposed moratoriums, as well. Outside the U.S., France and Bulgaria have banned fracturing, and Quebec, Germany, and South Africa, among other jurisdictions, have enacted moratoriums, which is of particular concern to global oil and gas companies, including Chevron and ExxonMobil.

These shareholder proposals are part of a larger effort coordinated by Green Century Capital Management and the Investor Environmental Health Network to press companies to increase disclosure around their fracking operations. This season, investors withdrew 70% of their proposals filed with companies with fracking operations after the companies agreed to provide increased transparency and ongoing engagement with shareholders on key investor concerns.

“Shareholders not only have the right, but the responsibility to press companies on how this increasingly controversial practice will affect their bottom lines,” said Larisa Ruoff, Director of Shareholder Advocacy for Green Century Capital Management. “Today’s votes should send a clear message to Chevron and ExxonMobil that their existing transparency fails to meet investor and community concerns. It is time for them to respond.”

This year, ExxonMobil attempted to block the shareholder proposal from appearing on its proxy ballot, but the Securities and Exchange Commission (SEC) rejected the company’s request, saying “it does not appear that ExxonMobil’s public disclosures compare favorably with the guidelines of the proposal.”

“The SEC decision clearly indicates that ExxonMobil’s existing disclosure falls short of what investors are looking for,” said Jon Jensen, Executive Director of the Park Foundation. “This proposal has been filed three years running without a meaningful response from the company. How long must ExxonMobil’s shareholders wait?”


 

Green Century Capital Management is an investment advisory firm focused on environmentally responsible investing.  Founded by a partnership of non-profit environmental advocacy organizations in 1991, Green Century's mission is to provide people who care about a clean, healthy planet the opportunity to use the clout of their investment dollars to encourage environmentally responsible corporate behavior. Green Century believes that shareholder advocacy is a critical component of responsible investing and actively advocates for greater corporate environmental accountability.

* As of March 31, 2012, neither the Green Century Balanced Fund nor the Green Century Equity Fund held Chevron Corporation or ExxonMobil Corporation. Green Century Capital Management, Inc., the investment advisor to the Green Century mutual funds, owns shares of stock in both Chevron and ExxonMobil. Green Century engages with companies, including those that do not meet the environmental criteria of the Green Century Funds, to improve the companies’ environmental performance and help foster a sustainable economy. Please refer to the Green Century Funds website for current information regarding the Funds' portfolio holdings. These holdings are subject to risk as described in the Funds' prospectus. References to specific investments should not be construed as a recommendation of the securities by the Funds, their administrator, or their distributor.  

** The percentage in favor was calculated by (i) dividing the number of votes in support of the proposal by (ii) the sum of the number of votes voted in support of and against the proposal. Abstentions and broker non-votes were not included in the calculation.  

You should consider the Funds' investment objectives, risks, charges, and expenses carefully before investing. To obtain a Summary Prospectus and/or Prospectus that contains this and other information about the Funds, please click here, email info@greencentury.com, or call 1-800-93-GREEN. Please read the Summary Prospectus and/or Prospectus carefully before investing. 

Stocks will fluctuate in response to factors that may affect a single company, industry, sector, or the market as a whole and may perform worse than the market. Bonds are subject to risks including interest rate, credit and inflation.

The Green Century Funds are distributed by UMB Distribution Services, LLC. 5/12

 


> Back To News Listings