The Lever | After years of using shareholder votes to pressure oil giants on climate, one activist triggered a corporate backlash that is reshaping the limits of investor power.
Just before midnight on a quiet Sunday in Amsterdam, Mark van Baal’s phone lit up. He’d been winding down for the evening, the weekend nearly over, when he noticed the international number and answered. On the line was a Reuters reporter calling from Houston.
“I’m sorry, I know it’s late in the Netherlands,” the reporter began. “But I’ve just published a story about Exxon suing you, and I want to give you an opportunity to respond.”
Within minutes, his inbox flooded with messages from other journalists, each with an astonishing claim: across the Atlantic, in a North Texas courthouse, one of the world’s largest oil conglomerates had just claimed his nonprofit, which Van Baal’s wife described as “just eight people and a dog,” was trying to put it out of business.
The next morning, the nonprofit decided to fight back. In a press release, Follow This declared, “Exxon Mobil is afraid of its shareholders.”
After the lawsuit chilled environmental shareholder activism across the U.S., Follow This revised its playbook. On Jan. 14, the group submitted resolutions to BP and Shell that make no mention of climate change or greenhouse gas emissions. Instead, the proposals point to International Energy Agency studies projecting that peak oil and gas demand will plateau and then begin to decline sometime in the 2030s. Follow This is asking BP and Shell to explain how they plan to remain profitable should that happen.
“We needed to speak their language,” says McKenzie Ursch of Follow This. “And these companies have not disclosed to their investors how they will continue to generate value under those scenarios.”
On March 11, BP informed Follow This that it would not be including its resolution at its April meeting. Follow This is now threatening to sue to force BP to convene an extraordinary general meeting.
“Whether BP was inspired by Exxon, the behavior is the same: incumbents instinctively fight anyone who successfully challenges business as usual,” says Van Baal.
