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GOVERNANCE

Shareholders defeat environment-related proposals at Chevron annual meeting

Chevron

Two environment-related proposals were defeated at Chevron Corp.’s annual meeting Wednesday, despite support from several large pension funds.

Approximately 73% of shareholders rejected a shareholder proposal calling for Chevron to issue a report on how it can transition to a low-carbon economy, according to preliminary voting results from the energy company.

Another shareholder proposal calling for an independent board director with environmental expertise was rejected by approximately 80% of shareholders.

The $322.3 billion California Public Employees' Retirement System, Sacramento; $189.4 billion Florida State Board of Administration, Tallahassee; C$316.7 billion ($235.4 billion) Canada Pension Plan Investment Board, Toronto; and $133.2 billion Texas Teacher Retirement System, Austin, voted in favor of both proposals, according to their proxy-voting disclosures.

The $206.5 billion California State Teachers' Retirement System, West Sacramento, and C$175.6 billion Ontario Teachers' Pension Plan, on the other hand, voted against both proposals, according to their disclosures.

Another shareholder proposal calling for an independent board chairman in the next CEO transition was supported by all six entities but rejected by roughly 61% of shareholders Wednesday.

Also, approximately 93% of shareholders approved the compensation of John S. Watson, Chevron’s chairman and CEO, and four other named executives.

The total compensation for Mr. Watson was $24.7 million in 2016, up from $22 million in 2015, according to Chevron’s 2017 proxy statement. The total compensation for the four other named executives ranged from $6.5 million to $9.4 million in 2016.

The Florida State Board of Administration was the only one of the six pension funds to vote against the executives’ compensation.

In a May report, proxy-advisory firm Institutional Shareholder Services recommended that shareholders approve the executives’ compensation, the two environment-related proposals and the independent chairman proposal.

Another shareholder proposal calling for Chevron to annually assess how its portfolio will be impacted under a range of climate change scenarios was withdrawn by its filers Hermes EOS and Wespath Investment Management in early May. Hermes and Wespath noted in a statement that Chevron was taking steps to improve its climate change risk disclosures.