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For the religious among us, the church offers guidance on matters spiritual and interpersonal.

The Church Of England is taking on a different type of role at ExxonMobil: activist investor à la Gordon Gekko.

Talk about divine intervention.

Active Management
The Church Commissioners manage a £8.3 billion investment fund on behalf of the Church of England. Its mandate is to earn a 5% return on capital and invest in an ethical and responsible way.

But the Commissioners are beginning to question their devotion to Exxon and have joined fellow activist investors in pushing the firm toward greener investments.

Bess Joffe, the head of responsible investment for the church fund, said action was “urgently needed for the company to improve its ability to create long-term sustainable value and pivot its strategy to support the energy transition.”

And the church is not alone in that view:

  • An emerging activist investor called Engine No. 1, which owns $40 million of Exxon stock, has called for an overhaul of the company’s strategy and a slate of new board members.
  • Earlier this week it was reported famed hedge fund D.E. Shaw has built a sizable stake in the oil giant and is pushing for cost cuts.

Low on Fuel
Despite the brewing shareholder pressure, Exxon has remained wedded to its fossil fuel roots.

Competitor BP recently published a report saying oil demand would fall by half in the coming three decades. For its part, BP said it would reduce fossil fuel output by 40% by 2030.

Exxon sees it differently. The company intends to increase its fossil fuel output by a third over the next four years and believes oil will remain a pillar of the world’s economy for decades to come.

Takeaway: Oil prices have been rising on vaccine optimism, but for now, Exxon is still in a rough patch.



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