Where was the Canary in the Boardroom? Why ExxonMobil’s Proxy Contest Loss is a Wakeup Call for all Boards [Russell Reynolds Associates]

Over the past five years, the largest institutional investors have been increasingly vocal and specific about their expectations of boards and directors regarding board composition and ESG. Despite this, they have rarely acted on those concerns when it comes to director voting. However, the ExxonMobil proxy fight may be a sign things have changed. Twenty twenty-one will go down as the year that large institutional investors aligned their voting with market communications and voted out three sitting board members at ExxonMobil. The world’s largest shareholders have now demonstrated that they are willing to act and that they expect executives to take action on ESG and climate change. Importantly, this is a lesson that board composition matters and director skills need to align with a company’s strategy.

I had the pleasure of assisting Rusty O’Kelley and Andrew Droste with this paper, which was published by Russell Reynolds Associates.