Washington Wants to Restrict Investor Activism Like Exxon Climate Change Resolution

Exxon Mobil shareholders demanded last month that the company disclose how the global fight to slow climate change would affect its profits. Legislation winding its way through Congress would make similar efforts harder, and in some cases, impossible.Current rules generally allow shareholders who own $2,000 worth of stock to introduce a proposal for shareholders to vote on, typically during the annual shareholder meetings. The new legislation, which predates the Exxon vote, would increase the ownership threshold to 1 percent of outstanding shares. At Friday prices, that would mean nearly $3.5 billion worth of shares in the case of Exxon, the world's largest publicly trade oil company.The proposal is part of the Financial Choice Act — introduced last year and approved by the U.S. House on Thursday — an effort by Rep. Jeb Hensarling, R-Dallas, to roll back financial regulations created after the Great Recession. "It would undermine the basic rights of shareholders to exercise important oversight over the companies they own — threatening the long-term interests of investors," said Chris Davis, senior director of the Ceres Investor Network, in a written statement. "It would effectively gut the ability of most shareholders to engage with their companies in a constructive manner on critical issues such as climate risk and corporate governance."  Continue reading...

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