Shareholders of ExxonMobil will determine Wednesday whether to replace up to four board members in a move that could mark a turning point for the oil giant on climate change.

The petroleum company, which has faced myriad shareholder votes on its climate stance over the decades, has battled the efforts of activist group Engine No. 1 to challenge ExxonMobil's petroleum-centered strategy in favor of one that embraces renewable energy investments as Royal Dutch, Total and other rivals have done.

The closely-watched contest will culminate at the board meeting, scheduled to begin at 1430 GMT.

The vote is expected to be close, with US business media pointing to BlackRock, Vanguard and State Street as potenially decisive in the outcome.

The three firms, which together manage about 20 percent of ExxonMobil's shares, have not publicly taken a position.

Once the biggest company in the Fortune 500, ExxonMobil was kicked out of the prestigious Dow index in 2020 amid a series of losses during the Covid-19 downturn.

Shareholders of ExxonMobil will decide whether to replace up to four board members with supporters of renewable energy investment
Shareholders of ExxonMobil will decide whether to replace up to four board members with supporters of renewable energy investment AFP / ERIC PIERMONT

"The energy industry and the world are changing," Engine No. 1 says in campaign materials that depict ExxonMobil as a dinosaur. "To protect and enhance value for shareholders, we believe ExxonMobil must change as well."

ExxonMobil has also been campaigning hard, establishing in January a new "low carbon solutions" business to commercialize carbon capture technology and announcing two new board members in March.

Activists have criticized these steps as insufficient and little more than public relations. The company's carbon capture policy, for example, rests of significant public policy changes.

On Monday, ExxonMobil sent a letter to shareholders pledging to appoint two more board members in the next 12 months, one with energy industry experience and one with climate experience.

"While there is still more to do, we are proud of the significant progress we have made to date," the company said.

"With our flexible plans, reduced costs, balanced capital allocation priorities and a strategy that delivers advantaged projects, including in our new Low Carbon Solutions business, we are positioned for success."

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