The House Judiciary Committee claims it has uncovered significant evidence of collusion within the financial industry to push radical ESG (environmental, social, governance) goals on U.S. companies. In a new report, the Republican-led committee accused financial firms and climate activists of acting as a “cartel” and specifically targeted Exxon Mobil (XOM) in 2021 by replacing board members after the energy company refused to meet certain climate demands.
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The committee, led by Ohio Republican Jim Jordan, called out groups like Climate Action 100+ and the Glasgow Financial Alliance for Net Zero. Indeed, he accused them of pressuring companies to adopt climate-focused agendas. Unsurprisingly, Climate Action 100+ rejected the claims by saying they don’t dictate shareholder votes.
This comes as criticism and lawsuits against ESG investing have been rising, such as the one led by Texas against BlackRock (BLK), Vanguard, and State Street (STT), which is accusing the firms of antitrust violations for allegedly inflating electricity prices.
Exxon Continues to Thrive
Despite the pressure from the climate “cartel,” Exxon has managed to thrive and reported record profits in 2022. The company now plans to boost oil and gas production to 1970s levels by 2030 while investing $30 billion in low-carbon projects. In fact, Exxon has completed 1,000 horizontal wells in New Mexico’s Delaware Basin since 2017 and is aiming for net-zero emissions in its Delaware operations by 2030.
The company’s innovative techniques, such as 4-mile horizontal laterals and cube drilling, are designed to maximize resource recovery while minimizing environmental impact.
Is Exxon a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on XOM stock based on 12 Buys, seven Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After an 11% rally in its share price over the past year, the average XOM price target of $131.20 per share implies 20.2% upside potential.
