On 22 March 2016, the SEC ruled that Exxon Mobil must allow its shareholders to vote on a proposal for annual reporting of how the company would be affected by climate change regulations. Nevertheless, it is open to Exxon Mobil to recommend against the proposal through its proxy document.

The ruling follows a request by the New York State Comptroller and four other shareholders who argued that investors need to know how the bottom line of Exxon Mobil will be affected by the global effort on reduction of greenhouse gas emissions and the company’s plans in this regard. The SEC did not find the company’s public disclosures up to the standards required by the proposal guidelines. Exxon Mobil declined to comment on the SEC ruling, but had earlier indicated that it intended to block a vote on the shareholder resolution, claiming it was vague and asking for metrics difficult to quantify.

Concurrently, Exxon Mobil is facing an inquiry by the New York Attorney General into Exxon Mobil’s climate change disclosures (discussed in our client publication here:

http://www.shearman.com/en/newsinsights/publications/2015/12/corporate-climate-change-reporting)