Oil and Gas

Exxon Holders Reject Split of CEO, Chairman Roles


Exxon Mobil shareholders rejected a proposal to split the company's chairman and chief executive roles.

Exxon Mobile
Robert F. Bukaty

Slightly less than 40 percent of shareholders voted at the oil company's annual meeting Wednesday to create an independent chairman. The tally for the same motion was similar last year.

Rex Tillerson currently holds both jobs.

Exxon recorded two of the largest-ever corporate profits in history in 2006 and 2007, but a growing group of shareholders has publicly backed the proposal, citing Exxon's lack of investments in alternative energy as their main motive.

The Rockefeller family has led the charge for creating separate roles, calling for a change at the top of the company that is closely tied to their famous fortune.

Roots Stretch Back to Standard Oil

John D. Rockefeller founded the Standard Oil, Exxon's precursor, in 1870, but the family has not been actively involved at Exxon for years. The company said no Rockefeller has served on its board, or the board of any of its predecessor companies, since 1911.

Peter O'Neill, great-great-grandson of Rockefeller, said 66 of the 78 adult Rockefellers currently supported their stance.

It is unclear how many shares the Rockefeller family controls. Exxon was able to identify 12 of the 15 Rockefellers associated with the shareholder resolution, and said they collectively own around 332,000 of the company's 5.4 billion shares—or about 0.006 percent of outstanding shares.

XOM Shareholders Reject Proposal

The family has been moved to act, driven by Exxon's passivity in what they see as an important emerging market.

Neva Rockefeller Goodwin, a great granddaughter of John D. Rockefeller and a Tufts University economist, called on Exxon to reconnect with the forward-looking vision of her ancestor. (For the full report on the today's Exxon vote, see the CNBC video at left.)

"Part of John D. Rockefeller's genius was in recognizing early the need and opportunity for a transition to a better, cheaper and cleaner fuel," Goodwin said in April.

Exxon has urged shareholders not to support the proposal to split the top jobs, saying it believes the most effective leadership structure for the current company is for Tillerson to continue in both roles.

Tillerson took the helm of the company at the beginning of 2006 and has steered a course similar to that set by his predecessor, the often combative Lee Raymond.

In Tillerson's time as CEO, Exxon has raised its spending on oil and gas projects, but has not made any significant moves into renewable or alternative energy.

Dissidents have also criticized the company for having a monolithic corporate culture, which prevents it from moving in new and innovative directions.

Exxon also faces 16 other shareholder proposals at the annual meeting, all of which the company suggested shareholders vote against.

They include seven proposals about the company's environmental policies and impact and three proposals on Exxon's executive compensation.

Another proposal asks shareholders to vote to prohibit nonbinding or advisory shareholder proposals, unless the board takes specific action to approve such proposals.

Shareholders of Exxon's rival Chevron, which also held its annual meeting on Wednesday, also voted to reject its own split of the chairman and CEO roles.

- Reuters contributed to this report.