Blue state officials are once again abusing their control over public pension systems in another political battle between Exxon and activist shareholders, highlighting how woke politics continue to creep into the boardroom and threaten the integrity of our public markets. While these officials claim to stand for the rights of shareholders, they are undermining the will of most shareholders to cause distractions and advance their own political careers.

For instance, CalPERS, the largest public pension fund in the United States just announced it will vote against all Exxon directors at the company’s shareholder meeting at the end of May. Meanwhile the New York State Common Retirement Fund will vote against all but two directors, and Illinois Treasurer Michael Frerichs is also urging shareholders to vote against Exxon directors.

Typically, when shareholders vote against sitting directors it is because the company is performing poorly and investors are losing money. However, in recent years Exxon’s performance has skyrocketed, doubling their earnings power between 2019 and 2023. Exxon is also poised to provide shareholders with healthy returns for years to come now that the company has successfully acquired Pioneer Resources, making it the dominant player in the United States’ most prolific oil and gas producing region.

So why are these sitting directors meeting with opposition? It is simply because Exxon asked a federal court if the company needed to include a climate related shareholder proposal from activists whose goal is to “shrink” the company, which would obviously harm shareholders.

Shareholders have already made their opinion known on this proposal, which was considered and overwhelmingly rejected twice. While public officials in California, New York and Illinois claim the company is attempting to “silence shareholders,” Exxon is actually looking out for their shareholders, who must subsidize the costs of these political proposals and deal with the unnecessary negative public relations they generate each May.

While it is unfortunate for Exxon to continually deal with political shareholders uninterested in the future growth of the company, the biggest losers are the pensioners who rely on their public officials to make investment decisions that will yield good returns to fund their retirements. Yet these public officials are attempting to “have their cake and eat it too” by making noise to appease political activists while understanding Exxon is a fundamental part of their portfolios.

For example, earlier this year, the New York State Common Fund essentially exposed that their anger towards Exxon is all for show when it divested a small amount of their holdings but acknowledged that completely divesting from the company would “go against fiduciary duty at this time.”

While productive shareholder activism can be a force for positive change, it must be geared towards maximizing shareholder returns, not destroying the target company for political purposes. Today, the actions of blue pension fund leaders are mostly noise that will have little effect, but over the long term, their actions ultimately set a dangerous precedent that threatens the stability of our financial markets.

Capitalism works because companies are primarily driven by maximizing their profits, which they can do when they provide a valuable good or service to society, instead of getting bogged down in political debates. If politically motivated entities use the process without regard to shareholder returns, all shareholders will suffer as public companies start to act like government, looking to appease various constituencies instead of maintaining a focus on increasing their profits by providing the best good or service they can.

As California, New York, Illinois and others use Exxon’s directors as their political football, it’s imperative that all fiduciaries and asset managers stand firm in defense of a company’s management who guided shareholders to record returns. We cannot allow political interference to destroy the integrity of shareholder votes. By doing so, we can ensure shareholder interests are protected and our markets remain free, fair and competitive for generations to come.

Andrew Sorrell is the State Auditor of Alabama.

The views and opinions expressed here are those of the author and do not necessarily reflect the policy or position of 1819 News. To comment, please send an email with your name and contact information to

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