Yahoo! Finance ExxonMobil Divestment Fail

Guest slam dunk by David Middleton

Yahoo! finance…

A Major Shareholder Has Divested From Exxon

Say Contributor

July 2, 2019

One of ExxonMobil’s biggest shareholders, Legal & General Investment Management, has removed the company from its $6.3 billion “Future World” funds over its failure to respond to climate change. LGIM, among Britain’s largest asset managers, has divested Exxon from the funds, which include companies that are socially responsible. LGIM says it will use its remaining Exxon shares that aren’t in the Future World funds to vote against CEO Darren Woods’ re-appointment as board chair in 2020. What does this mean for Exxon? Though LGIM is one of Exxon’s top 20 shareholders, its divestment puts only a small dent in Exxon’s equity — LGIM owns about 0.6% of the company’s shares…

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Yahoo! Finance

“What does this mean for Exxon?”

“Though LGIM is one of Exxon’s top 20 shareholders, its divestment puts only a small dent in Exxon’s equity — LGIM owns about 0.6% of the company’s shares…”

Horst-schist!

It doesn’t put any sort of “dent in Exxon’s equity”… These buffoons couldn’t have divested any shares unless investors were willing and able to invest in them

“Though LGIM is one of Exxon’s top 20 shareholders…” I doubt it.

Yahoo! Finance

The only thing that’s put a “dent in Exxon’s equity” is the collapse in oil prices since 2013-2014.

Yahoo! Finance earns eleventy gazillion Billy Madisons…

In case you were wondering

Horst….

Horst and Graben (US National Park Service)

Schist…

Vishnu schist (US National Park Service)

51 thoughts on “Yahoo! Finance ExxonMobil Divestment Fail

  1. I moved my investments in L&G funds elsewhere years ago, so no need on my part to take any action now.

    • Makes me wish they were handling my investments now…
      Just so I could withdraw them and take them someplace else

  2. Does the UK have fiduciary rules for investment funds of this type? The management would seem to be opening themselves to a lawsuit if so.

    • Below is the text of a letter I sent in response to communication from them on my investments. I would encourage others similarly to make their views clear.

      “Subject: re: Active investing

      I note with interest your statements on active investing.

      Should any active investing decisions on the grounds of environmental or
      other concerns operate against my financial interests, I will actively
      consider divesting from your platform, transferring my investments
      elsewhere. I would also in that case actively seek to participate in
      class-action or other law suits to obtain financial redress.

      I did not hire you to use my money to support political causes which I
      do not myself support. To pretend that these causes are not political is
      to completely fail to understand the world.

      I can tolerate this only as long as no apparent financial impact ensues.

      In that case it is merely utterly reprehensible, rather than actionable.”

    • There have already been warning shots across the bows for Australian superannuation funds. Even giving your consent does not work because the act reads that they must operate in the interest of the member and the member has no right to alter that (the remains the privilege of the government who controls the funds). Then you have the reverse a member trying to sue Rest Super fund for not including climate change in their risk assessment (Mark McVeigh vs Rest Super).

      Ultimately the courts and the government will have to wade in and make law and precedent because Super Funds are between a rock and a hard place.

    • Let’s remove a citizenship question from 2020 census, and retreat from Syria. None of these noble ideas survived a week.

    • No politician gets elected on the basis of climate change, as the Australian 2019 federal election showed. Trump knows that, so why bother? It is not as if Trump cared about science anyway.

    • If Trump is dismantling the Obama framework limiting oil production, over-regulating coal, and generally removing the alarmist infrastructure anyway, is the red team/blue team exercise still important? At the end of the day, it would have only been a debate win, which could have been ignored by the next alarmist denizen of the White House.

      • It would be nice to get that ridiculous endangerment finding removed. I was hoping the red/blue would put so much pressure on it to make it impossible for EPA to defend it.

      • It’s extremely important that the public sees that CAGW is indefensible when put to the test.

        The media has stated that there is no requirement for balanced coverage because the science is settled. Not only is the science not settled in favor of CAGW, real science is against CAGW. When the public clearly sees that, the consequences will be huge.

      • “If Trump is dismantling the Obama framework limiting oil production, over-regulating coal, and generally removing the alarmist infrastructure anyway, is the red team/blue team exercise still important? ”

        Yes, because anything Trump does can be undone by the next administration.

    • “red team fail”

      Well, now that Bernie and AOC have declared we are in a “Climate Emergency” I suppose someone in the Trump administration is going to have to come out and say there is no emergency. Either that, or agree with Bernie and AOC.

      If the Trump administration does’t agree with Bernie and AOC then they should prepare to answer why they don’t believe it.

      So the question to ask the Trump administration is: Do you believe the science of climate change is settled or not? If not, why not? To convince people of the rightness of your position you are going to have to answer some questions about the science. Killing the Red Team/Blue Team concept is counterproductive to this endeavor.

      Never Fear! WUWT will fill the gap, Red Team or no Red Team! 🙂

    • Its hard to have a debate with people who hide their data and exaggerate things all while touting failed modeling as accurate to the 95th percentile. (All modeling fails and even the IPCC admits it). When one side refuses to debate the UN-settled science its a kin to taking your ball, crying, and running home.

      None of the alarmists were going to get caught up losing this debate and killing the control movement.

      • People that hide their data and exaggerate things all while touting failed modeling as accurate to the 95th percentile. (All modeling fails and even the IPCC admits it)

        have nothing in hands to defend their position. So in a perfect world they should lose from the start.

        But then – which world is a perfect!

    • It is unfortunate that Trump hasn’t pushed for a quick Red Team event. As I see it, there are three possible outcomes: Win, lose, or draw. In the event of a win, it would dull the media criticism of him. With less negative press (The MSM will always find things to criticize!), it should bolster his bid for re-election. That is, it would be a win-win. In the case of a loss, the prudent thing to do would be to announce that he was wrong. Again, that would eliminate one more thing that the press can criticize about him. In the event of even a draw, the thing to do would be to point out that the science is NOT settled and there is more research necessary. That again gets the press off his back, and lets Happer and the other panel members take the heat for holding a position they can’t prove.

      Skeptics have a Bayasian a priori probability of 2/3rds of being vindicated. Even a draw establishes credibility to those the Media currently depicts as being fringe elements. Personally, I’d like to see at least a draw or, preferably, a crushing victory for the Red Team. Trump’s advisors appear to have ulterior motives for opposing any open debate. I would think that if they truly support Trump, they would want to remove any doubt about his view of climate and remove the opportunity for the press to criticize him. But, living in a swamp is fraught with dangers.

    • imo the decision to kill the climate committee is a tragedy in the making. Failure to counter the massive propaganda campaign by the warmists is a mistake in that it leaves the field wide open to those who exaggerate or simply manufacture untruths. While the skeptics blogs are first-rate and effectively counter the mistruths, such blogs are read by relatively few compared to the msm. It is thus inevitable that the constant drum-beat by warmists will convince many that there is a climate crisis (or now, emergency) as that is the only viewpoint presented to the public. Why that is not apparent to those advising Trump is simply beyond me.

      • Leo you are so right. I fear this could be the beginning of the end for our guys, Trump and co. are running scared and playing directly into the hands of the of the Dems. I can only hope i am wrong,

    • red team fail

      If so, because he realizes whatever comes out of that will make no difference combating the climate-industry juggernaut. Other methods (which he has & hopefully will continue to do) make more difference.

  3. Somebody sells, somebody buys…..doesn’t do squat to the equity of a big company like Exxon….

    • Meanwhile, Exxon Mobil stock price has advanced more than 1.75% in the week Jul3- July 10- @11am.
      That’s not a bad 1- week return, which would more than double their money in less than a year.

  4. The only way to divest from oil and gas is to stop using it. Good luck with that.

  5. Exxon Mobil Corp (NYSE: XON) is presently trading at USD $77.11/share versus USD $75.72 share closing price on July 2. That represents a lost gain of over 1% in just those 7 intervening days.

    I’m so glad I don’t have any holdings of Legal & General Investment Management.

  6. This is both political nonsense and grandstanding at the same time that should not have any influence on investment decisions. Political correctness that is virtue signaling with other peoples’ money.
    Investors should remove their funds from this management group.
    Ironically, a major bear market for crude took a major step down beginning in 2014. This was discounting the technical revolution. At the time I noted similar “revolutions” in hard-rock mining. Low-grade copper with Bingham Canyon, just south of Salt lake City. Bingham began in 1910 and is still operating.
    Then in the late 1960s Newmont figured out how to mine low-grade gold at Carlin.
    The oil patch has been accomplishing a technical revolution, which has been one price depressant.
    The other will be that this financial bubble is climaxing and post-bubble contractions in the past have depressed industrial commodity prices. For along time.

  7. Just so you know Exxon is a major component of the S&P 500 Index as part of the energy component of the index. Any investment fund or fund allocation targeting the Index will have Exxon in its holdings. BTW that’s why a lot of investors missed the shale boom because mostly non-S&P 500 Index oil firms developed those plays. The oil majors had to buy their way in to those plays much later.

    The Index will remain a major investment target for major institutional investors like pensions and sovereign wealth funds. Such huge investment pools are forced to invest in large Index targets because of the shear size of the investment. Ignoring the large cap names and the S&P Index increases risk elsewhere and works against fiduciary responsibility of the pension plans. More narrowly focused oil fund allocations could be divested at the expense of returns and diversification strategies of huge portfolios.

  8. I have an idea..every country ship all their oil to the USA. We will store it so your not tempted to pollute with it. 😉

  9. This is in line with the idiotic policy of the Synod of the Church of England which in its disinvestment will put a dent in the pensions of all their poor retired priests. But these proud prelates have no science and care not a toss for the poor of the world who need fossil fuelled electricity right now. Luckily the Chinese are supplying- thoroughly Christian.

  10. If divestment were to reduce the price that means sensible people/funds can buy cheap and get rich. Bring it on!

    • Ryan S
      Implicit in your question is the assumption that the activists are rational. Proof of that assumption is not in evidence.

      • Press release 21 June 2019

        Despite the positive momentum, however, there remains more work to be done. Following LGIM’s updated assessment in 2019, five new companies will be voted against and divested from the Future World range due to unsatisfactory results: ExxonMobil Corporation, Hormel Foods, Korean Electric Power Corporation, Kroger and Metlife.

        21 June 2019, XOM rises $0.65/share in 2x normal trading volume.

        XOM has tracked DJIA since 21 June.

        Can you say “futile and stupid gesture”?

      • Surely you jest. First, regardless of what the stock price does, XOM isn’t affected (unless they plan to issue additional shares, which they don’t). Secondly, the price XOM commands is primarily based on the 4.49% dividend they pay, and the expectation of continued dividends. Those, of course, are based on the fundamentals of tbe company (revenues, expenses, debt, profit, etc.) and future expectations. These considerations are not changed through the buying or selling of its stock.

        If LGIM dumped enough shares to move the price downward, it would send the yield up, Fund managers and traders whose first concerns are making money, rather than virtue signalling, would jump at the chace to buy in at the lower levels, sending the price right back up. I would promptly sell my shares of BP (British Petroleum) and PSX (Phillips Sixty-Six, to buy XOM if the yield went up.

        The price of a stock is not determined by political boycotts. Believe it or not, virtually all traders and hedge fund managers are only interested in making a profit.

        The only way to affect XOM, other than by legal dictat, is to send revenues down, i.e., boycott the company. Stop buying oil and oil-derived products. Do that, and I will respect you. I’ll be laughing at what your lifestyle will be, but I will respect your honest commitment. Divestiture, though, is meaningless grandstanding.

    • At 0.6%, it wouldn’t matter if they were #11. Vanguard, Blackrock and State Street are XOM’s largest shareholders. Four Vanguard funds have at least 0.6% of XOM’s outstanding shares…


      The fact that the @$$hats chose to further beclown themselves with this comment is priceless…

      LGIM says it will use its remaining Exxon shares that aren’t in the Future World funds to vote against CEO Darren Woods’ re-appointment as board chair in 2020.

  11. It is as you state, David. There is zero change to Exxon stocks.

    L&G manage funds for people. Their funds are tailored to kinda/sorta fulfill investment desires for various reasons.
    Each fund has a percentage allocation of stocks, bonds, treasuries, interest bearing securities, mortgages, etc. etc. that sorta/kinda meet the investment desires or fund manager promises.

    In this case, one of L&G’s “Future World” funds is supposed to “tracking the performance of the FTSE All-World ex CW Climate Balanced Factor Index (the “Index”). That is, L&G are allegedly providing “Index also gives greater weight to companies that meet positive carbon and environmental criteria. This means the Fund will invest more in companies that meet these criteria, and less in companies that do not.”

    L&G did not eliminate Exxon stocks from L&G funds. Only, that L&G removed Exxon stocks from one fund that tracks some alleged ‘carbon and environmental’ index.

    L&G did not sell their Exxon stocks, they simply moved them to a different fund or funds; e.g. their Global 100 Index Trust, where Exxon Mobil constitutes 2.5% of their holdings in this fund.

    Another pea hidden under a shell ruse.

  12. I offer $1 for each BP share and $0.50 for each share of Royal Dutch Shell and $0.05 for each share of Total.

  13. The article deliberately confuses Legal & General Investment Management as a whole and their Future World fund. That fund has been created specifically to attract “greens, ” the rest of the organisation is not involved in this stupidity.

  14. It’s not just oil. The Progressives are calling to boycott companies that support Conservative values. When divisiveness is reduced to what products you buy the foolishness is out of control. If the Left is really serious about impacting corporate profits of companies not aligned with their ideology what’s stopping them from ceasing to buy motor fuel? Could it be hypocrisy? Or reality? Most likely both.

  15. Voting against Woods seems like a good idea:
    “Woods has publicly endorsed the Paris climate accord. The accord commits nations to cutting greenhouse gas emissions. In May 2017, Woods wrote a personal letter to President Donald Trump to urge that the U.S. remain a party to the agreement.” https://en.wikipedia.org/wiki/Darren_Woods

  16. I hereby offer to purchase any and all shares of XOM that any Warmunist wants to sell for US$10/share. This offer expires at midnight July 31, 2019

  17. Seems likely that the bifurcation seen in media separating into opposing camps of purer and purer ideological presentation/viewership, will show up in stock ownership as well. These divestment protest moves will simply lead to purer and purer strains of investors being the voting blocks inside any particular corporation. Little bit of Darwanism likely will take hold. Prioritizing investment on environmental or woke policies will reap or suffer the “rewards” that kind of business affords. Whereas investors more concerned with financial returns will reward the corporations that reward them.

    If enviro-loons pull out of Exxon, then Exxon won’t worry about appeasing that type of investor. Companies focused on CGW or their pontificators’ concerns will have to contend with the very real consequences that catering to ideas inconsistent with the free market and profitable reality produce. Sadly, taxation will rise as my state’s pension program will almost certainly go the wrong way on this.

  18. Excellent point, Zack.

    Businesses make business decisions. Governments make political decisions. When governments try to run businesses, they make political decisions. That’s why they fail at it.

    “Prioritizing investment on environmental or woke policies will reap or suffer the “rewards” that kind of business affords.”

    Exactly. These are POLITICAL decisions, not business decisions. Trying to run a business on political decisions will always fail. May not be til the next administration, but they will fail. See GE, DuPont.

  19. You are a mental midget if you park your money with PC projectionists
    Exxon sells a legal product that as resulted in the highest standard of living ever on earth .
    Yeah pure brilliance … don’t want to be associated with that .
    “failure to response to climate change ? Are these clowns serious .
    Can we assume they think climate doesn’t change without human use of fossil fuels ?
    If I had any money in this fund it would be gone .

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