We couldn’t help but do a double-take as we read the proxy that Exxon Mobil (XOM) filed yesterday. And it had nothing — really — to do with compensation or perks. As the WSJ pointed out this morning, last year was pretty good for the company and yet the compensation for Chairman and CEO Rex Tillerson wasn’t as supersized as some we’ve seen.
Nope — our chuckle was over a shareholder proposal, which caught our attention not just because of the subject matter, but because of its placement at the top of a list of 17 shareholder proposals, which seems like it may just break some sort of record. Proposal No. 3 from the $11 million Free Enterprise Action Fund run by anti-global warming Steve Milloy states this:
—Resolved: That the Company amend its bylaws to no longer permit shareholders to submit precatory (non-binding or advisory) proposals for consideration at annual shareholder meetings, unless the board of directors takes specific action to approve submission of such proposals. Stock ownership has become politicized. Many shareholders own stock in publicly-owned corporations in order to use the corporations as a means of advancing the particular shareholders— social or political agenda. A primary tool of —activist— or —nuisance— shareholders is the submission of non-binding precatory (advisory) proposals for discussion and vote at annual meetings of shareholders.
While the Free Enterprise Action Fund, which in addition to running a mutual fund is also registered as a 501(c)(3), has submitted various shareholder proposals last year and has 12, including the one at Exxon, this year. Most of them deal with global warming and getting companies to stop wasting money on studies that the fund says are based on bad science. But the Exxon proposal is the only one to address the growing number of shareholder proposals.
Besides the obvious irony of someone submitting a shareholder proposal to stop wasting time on shareholder proposals, we’re sure that it’s entirely coincidental that this proposal wound up at the top of the list of 17.
