Exxon shares leap as activist investor Jeff Ubben joins the board
Exxon Mobil announced two board changes on Monday, including activist investor and ESG advocate Jeff Ubben, to signal that the company faces its uncertain future as the world moves towards clean energy and investors shy away from oil stocks.
Exxon said the other new board member was Mike Angelakis, chairman and CEO of Atairos and former Comcast CFO.
Exxon shares rose 4.7% after CNBC’s David Faber first reported on the switch. Ultimately, the stock ended the session 3.7% higher.
The moves come as Exxon faced shareholder pressure to reorganize its board of directors amid the company’s weak share price. Exxon’s Investor Day is Wednesday.
“We welcome these new directors as part of our ongoing Board of Directors renewal that builds on the diverse global business experience of our current members,” said Chairman and CEO Darren Wood in a statement. “Your contributions will be judged as ExxonMobil drives plans to increase shareholder value by responsibly providing the energy it needs while leading the energy transition.”
The board changes come after Exxon announced a new director in February who expects to “take further action in the near future”.
DE Shaw Group, which Exxon pushed for changes, said it supported the latest changes on the board.
Ubben founded Inclusive Capital Partners in 2020 after stepping down from ValueAct, the company he founded in 2000. In his final years, he headed ValueAct’s Spring Fund, which focused on sustainable investing.
According to the sources, Ubben is expected to become a significant Exxon shareholder over time. Ubben is no stranger to investing in oil and gas companies. While at ValueAct, he got involved in BP and said traditional energy companies can be in ESG portfolios.
Exxon has come under fire for not investing in the future of energy. Earlier this year, the company announced plans to invest $ 3 billion in carbon capture and other emission-reducing technologies.
In December, the then newly founded activist investor group Engine No. 1 announced plans to seek four Exxon directorships. The group, which includes founders of activist hedge funds such as Partner Fund Management and Jana Partners, received support from Californian pension giant CALSTRS.
After Exxon announced in February that former Petronas CEO Tan Sri Wan Zulkiflee Wan Ariffin would join the board, Engine # 1 said the changes did not go far enough. The group repeated this sentiment after Monday’s announcement.
“While ExxonMobil has now acknowledged the need to change its board of directors, it lacks directors with diverse track records in the energy industry who can position the company for success in a changing world,” said Engine # 1. “We remain confident that our nominees will Have the right experience and skills to set ExxonMobil on the path to creating sustainable, long-term value for the benefit of all shareholders. “
Exxon’s shares are up 32% this year.
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