Tomorrow will see the stockholders at the Exxon Mobil shareholder’s meeting act on a measure that might become a step to bringing Exxon Mobil a step closer to becoming involved in alternative energy. The shareholders are working to separate the chairman and chief executive officer jobs from two positions filled by one executive as the jobs now are commonly filled in the U.S. into two positions occupied by two executives.

Stranded somehow by the corporation’s bylaws into a non-binding vote, the results may come out in the news Wednesday afternoon. With a large body of private and institutional investors lined up in support, the measure still would need a board of directors vote to become the corporate practice. The story is that this isn’t the first try, it’s the sixth try with last years vote getting to 40% support.

But the corporation management and the board must be realizing that having dug in and resisted isn’t paying off. With the big oil backlash, even if a falsehood in premise, and the essentially obvious trend that oil and gas will be declining markets over the coming decades along with a wealth of opportunities lost, the board is increasingly working against a strong tide.

Underlying all of this is the U.S. practice of weak shareholder representation on corporate boards. It could well blow up in the board’s face. The other point that may be more important outside of the shareholders issue is the underlying lack of Exxon Mobil to get itself repositioned into the alternatives that will occupy the future. With the other four “big oil” companies getting their feet wet and Royal Dutch Shell racing in front of everyone, a long term investor, and customers, must be getting alarmed that the corporation isn’t moving toward a position for the future.

In defense of the management and board, who might be simply waiting to see how the future’s cards will be dealt out, the cards are not being dealt at all now, which is a firm defense. There will be markets for oil and gas products for the foreseeable future, but. As things change the largest free world independent oil company leadership is still exclusively keeping its head in a bore hole. Maybe the cards are not dealt, but what the cards are gets clearer by the day. Failing to be in eliminates being able to influence and add value to the discussion and more worrisome, the potential.

What’s missing in the dealing with the coming new energy and fuels markets is markets. Farmers put decades of efforts into ethanol and were at the right place at the right time after years of effort and frustration even with low level efforts by government to help out. Events are going to pick up the pace, and there are certain losses to become apparent from getting caught without oars to put in the water.

For the rest of us the idea that the world’s largest free and independent oil company has its head stuck in the sand isn’t reassuring. Its sure to make everyone take a prejudiced and jaundiced view that gets harder to overcome as time goes on. At the sharp leading edge the fact that the resources in capital, intellect, skills and incentives are being waylaid, by nothing other than hard headedness by a few. Even though Exxon Mobil is a private concern, it is still a huge free world resource that is not being put to its best use.

Let the storm rage tomorrow and let’s all hope that the shareholders finally impress management and the board to get its act together. Exxon Mobil may have as much or more to bring to the future as any company in the world and to be wasting time now is a sorry thing indeed.


5 Comments so far

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