This year’s corporate annual general meetings are unfolding amid geopolitical developments that arose well after shareholders could propose agenda items. The US military actions in Iran and the coup in Venezuela have significantly disrupted the global energy landscape, prompting some nations to reevaluate their reliance on oil and gas and hasten the shift towards renewable energy.
Investors who have long been aware of these risks have proposed resolutions urging companies to detail how they will safeguard investors if the demand for oil and gas decreases. Nonetheless, these resolutions are absent from the proxy tickets of major publicly-traded oil and gas firms, a result of persistent corporate maneuvers to suppress shareholder voices. US-based companies, emboldened by permissions from the financial regulator, have been particularly dismissive of such proposals this year. In response, shareholders are retaliating with legal actions to enforce their rights.
BP: A Cautionary Example in Corporate Governance
The tension this shareholder season is particularly intense at BP, which has experienced a steep drop in stock value. Although various factors have contributed to BP’s difficulties, including the Deepwater Horizon oil spill, some investors blame the company’s previous investments in renewable energy. In reaction, BP has appointed a new CEO and board chair to realign its strategy with a focus on oil and gas, while maintaining its commitment to achieve net-zero emissions by 2050.
This renewed focus on fossil fuels has led BP to commit two major omissions on its proxy ticket: first, by not including a climate-related resolution, and second, by attempting to nullify previously-approved resolutions regarding greenhouse gas emissions.
The first omission involves a resolution from sixteen institutional investors, including large pension funds, requesting BP to explain how it will maintain shareholder returns if oil and gas demand decreases. This is a pressing issue: even before the Iran conflict, organizations like Rystad Energy and the International Energy Agency had forecasted a peak in demand between 2030 and 2035, influenced by factors such as government policies and technological advancements.
BP dismissed the resolution, arguing it attempts to dictate board actions, whereas Shell included a similar resolution from the same investors in its proxy statement. Strangely, BP did accept a comparable resolution from the Australasian Centre for Corporate Responsibility that questioned how BP’s plan to boost oil and gas investments aligns with declining market value trends. BP recommended shareholders reject this proposal, provoking backlash from investors like the large pension fund California State Teachers Retirement System (CalSTRS), which recently divested $600 million from oil and gas majors to mitigate climate risk.
In the second instance, BP’s management is requesting shareholders to rescind two earlier resolutions—one from 2019 and another from 2015—that required the company to report emissions from its operations, among other metrics. BP argues that recent government policies make this reporting redundant. However, investors counter that eliminating this information represents a failure in accountability, particularly given BP’s climate pledges.
Investors released an open letter earlier this month condemning BP’s dismissal of the demand-related resolution and the move to end disclosures, also calling for the removal of BP’s board chairman. “This is, ultimately, a question about whether the commitments a board makes to its shareholders are upheld,” the investors stated.
Regulators’ Inaction Fuels Legal Battles
This year, major US oil companies are supported in boardroom decisions by the US Securities and Exchange Commission (SEC), the government’s financial watchdog, which has stepped back from its essential role of mediating resolutions.
The 1934 statute establishing the SEC mandates that companies must vote on shareholder proposals meeting the law’s criteria. Historically, if companies and shareholders disputed whether a proposal adhered to these criteria, they could appeal to the SEC for review and expert guidance. SEC Chair Paul Atkins stated in November 2025 that the agency will cease to perform this role, allowing companies to reject proposals freely and compelling disenfranchised shareholders to pursue legal action.
Numerous companies have targeted climate change-related resolutions. The investor advocacy group As You Sow filed a resolution in January urging the insurance company Chubb to evaluate whether subrogation—a legal process enabling insurers to recover costs from at-fault parties—could mitigate losses due to climate change. Insurance premiums have risen following climate-related disasters as companies transfer losses to homeowners.
The resolution highlighted that attribution science has advanced enough to assign responsibility for climate change to specific parties, forming the basis of recent legislative proposals in California and Hawaii. When Chubb declined to include the resolution on its proxy ticket, As You Sow filed a lawsuit claiming Chubb violated US laws governing shareholder proposals.
While Big Oil CEOs and anti-regulatory advocates might view these lawsuits as excessive, they should remember the lawsuit ExxonMobil filed against shareholders in January 2024 to block a resolution requesting the company to set global warming emissions reduction targets. Despite the SEC’s adjudication process being active, ExxonMobil bypassed it to send a message to investors, proceeding with the lawsuit even after the proponents withdrew the resolution. This lawsuit created such a chilling effect that ExxonMobil shareholders have not had the opportunity to vote on any climate-related resolutions since.
Energy Shocks Highlight the Importance of Resolutions
In light of President Trump’s unauthorized military actions against Iran, resolutions urging companies to prepare for a potential decline in demand appear foresighted. Prior to the conflict, energy forecasts by BP, Shell, and ExxonMobil anticipated an increase in oil and gas demand, and their production plans mirrored this optimism. Surveys comparing corporate and non-corporate energy outlooks reveal that corporate projections typically predict higher fossil fuel demand, partly because they underestimate changes in consumer behavior and ignore the rapidly falling costs of renewable energy sources. They also fail to acknowledge their lobbying efforts against policies that would reduce demand.
The new energy dynamics created by the Middle East conflict challenge these assumptions, adding another layer of risk to an already risk-laden industry. Although oil companies often include standard language in their annual reports about the risks posed by political instability, they do not address the fact that oil and gas are more susceptible to geopolitical risk than other energy forms. A global shift away from fossil fuels towards renewables for energy security is a distinct possibility. Such a transition is already underway in Europe, and studies demonstrate that geopolitical risk reduces fossil fuel demand and boosts renewable energy investment even in BRICS economies. As major carbon emitters, oil and gas companies are also more affected by government policies and litigation aimed at addressing the impacts of climate change on people and the economy.
The resolutions blocked by oil and gas companies this year aim to address this reality: “Transparent disclosure of how BP would navigate declining demand scenarios is…essential not only for assessing company-level resilience, but also for understanding risks to shareholders’ diversified holdings,” resolution sponsors noted in their letter.
Among those confronting reality, there is a growing consensus that the risks associated with maintaining the fossil-fuel status quo are too significant—for public health, finances, the economy, and the environment. While CEOs can clash with investors in boardrooms and courtrooms, they can only delay addressing this reality for so long.
