The US Securities and Exchange Commission (SEC) has decided not to pursue charges against Climate Action 100+ following an investigation into the group’s activities around ExxonMobil’s 2021 shareholder meeting, but warned major investors to pay closer attention to securities disclosure requirements ahead of the 2027 proxy season.
The SEC said its investigation examined the climate-focused investor group’s role in the May 2021 meeting, when major asset managers including BlackRock, Vanguard and State Street backed several board candidates put forward by activist investor Engine No. 1.
Engine No. 1 had argued that ExxonMobil needed to respond more effectively to the energy transition. The shareholder vote resulted in three of its four nominated directors being elected to Exxon’s board.
Although the SEC has closed the matter without charges against Climate Action 100+, the regulator said its concerns should serve as a reminder to large shareholders about their obligations when coordinating investment activities and making required disclosures.
The case comes amid continuing scrutiny in the United States of how large asset managers incorporate environmental and social considerations into investment decisions. Some US lawmakers have questioned whether coordinated action by major investors could raise antitrust concerns.
The SEC’s warning could influence how institutional investors approach shareholder campaigns and disclose their activities during the next proxy season.
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