The drama is over in Dallas… for now. ExxonMobil management has prevailed in shooting down dissident shareholder resolutions to split the role of CEO and chairman now held by Rex W. Tillerson and other resolutions regarding reducing greenhouse gas emissions and boosting renewable energy.
The confrontation had plenty of drama since some of the resolutions came from the Rockefeller family, the heirs to the massive fortune created by company founder John D. Rockefeller.
Here are some points to take away from today’s vote:
- Look at the levels of voting. Splitting the CEO and chairman roles got 39.5 percent, almost the same as it received last year. Greenhouse gases got 30.9 percent and boosting renewable energy research got 27.4 percent. My point is that these are rather high figures and show a significant minority opposition among ExxonMobil shareholders. Many such resolutions are lucky to get 20 percent of the vote. Percentages such as those in Dallas today are not exactly resounding affirmations of faith in management even though the resolutions did not succeed.
- The ExxonMobil meeting takes the debate about splitting chairmen and CEO roles one step further. Severing the roles is commonplace in European companies, notably in the United Kingdom, but here, the debate rages on. Some believe that splitting gives a corporation the kind of checks and balances it needs to prevent arrogance and hubris, if not downright criminality. Other studies show that splitting doesn’t really bring much to the party in terms of efficiency or oversight.
For you dear readers interested in the issue, here are two studies from McKinsey and one from Booz Allen (now Booz & Co.) Check McKinsey study one and two and Booz Allen. Weigh in with your view.
