If you have not heard of Engine No1, you soon will. It’s not Thomas the Tank Engine, but a somewhat opaque group which has inflicted structural damage on ExxonMobil, once the world’s most valuable company. Engine’s proposals at the annual meeting this week may have looked like tilting at windmills, with its $50m stake in a $500bn company, but it spent over $30m soliciting support, and despite Exxon matching that, the company lost.
The dissidents have won dramatic board changes to bounce an oil company into ceasing to look for oil. Exxon’s board might have thought it could stall the Engine, but it has been blind-sided by an unintended consequence of the rise of tracker funds. Three of them hold a fifth of Exxon shares between them, while other big pension funds and the UK’s Legal & General, running before the wind, are sympathetic to greenery.