The North Carolina State Treasurer intended to send a message to Exxon Mobile's board of directors:
North Carolina will withhold its shareholder votes for five directors at Exxon Mobil Corp.'s annual meeting this week to protest high executive pay as gasoline prices soar, State Treasurer Richard Moore said Tuesday.
Grabbing on to an issue popular among voters, Moore said the North Carolina retirement system will decline to support the re-election of the directors who have served on the board's compensation committee. The system owns 11 million shares of Exxon Mobil stock valued at $663 million. The company's annual meeting is Wednesday in Dallas.
Congress and the public have complained about a nearly $400 million retirement package given recently to the energy giant's former chairman, Lee Raymond.
"As shareholders, we are outraged that executives are using soaring gas prices, which are hitting consumers at the pump, to fatten their own wallets," Moore said in a statement. "The excessive pay packages, like that seen at Exxon Mobil, diminish shareholder value and are evidence of policies that fail to generate long term value for shareholders."
The pension system's shares in Exxon Mobil account for the single largest holding in the state's public equity fund. About half of the shares are held in indexed funds managed by outside advisers, according to Moore, who is the sole fiduciary agent of the retirement system's $72 billion in assets and decides how to vote on shareholder issues.
The shares make up just a small fraction of Exxon Mobil's roughly 6 billion outstanding shares, though. It's unclear whether the move by Moore or other shareholders will make a difference or block the directors from being seated.
In the end, it didn't make any difference. All of the board members were elected, and resolutions to require shareholder approval of executive compensation were rejected.
The Chairman and CEO defended the previous CEO's $147 million retirement package, but acknowledged shareholder displeasure as evidenced by some of the votes. He also said Exxon couldn't do anything about gas prices, and that Exxon isn't interested in alternative fuels, saying they "won't invest in lower-return products."