SEC closes Exxon Mobil proxy probe without enforcement action

The US Securities and Exchange Commission decided not to pursue enforcement action against Climate Action 100+ participants following an investigation tied to Exxon Mobil Corporation. The inquiry reviewed shareholder voting conduct surrounding the oil producer's May 2021 annual general meeting.

The regulator published a Section 21(a) report detailing the probe. It marked the first time the commission had released a Section 21(a) investigation report since 2018. While regulators chose not to file charges, they warned institutional asset managers about disclosure obligations heading into the 2027 proxy season.

The inquiry examined whether major asset managers acted as an undisclosed group during the 2021 board contest. At that meeting, an activist fund ran a dissident slate of 4 nominees and won 3 seats on the ExxonMobil board. Ahead of the vote, BlackRock held 6 meetings with the activist fund and 2 direct engagement meetings with ExxonMobil. The report noted that in 2020, BlackRock had voted against 10 shareholder proposals flagged by the climate alliance.

Scrutiny over corporate climate initiatives has intensified among US lawmakers and regulators. By 2024, approximately 70 investors had withdrawn from the Climate Action 100+ coalition.