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ExxonMobil's industry leadership deteriorates under CEO Darren Woods

October 28, 2020
Tom Sanzillo and Kathy Hipple
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Key Findings

ExxonMobil’s pre-pandemic financial performance has deteriorated during the first three years of Chairman and Chief Executive Officer Darren Woods’s tenure (2017- 2019). Each of the company’s core financial metrics—shareholder returns, cash flows and profits—has slipped.

The company’s board of directors has failed to report the extent of this deterioration transparently to shareholders. It needs to be more open with its shareholders and more decisive that the company needs new management.

Executive Summary

IEEFA conducted a thorough analysis focusing on the three financial metrics from January 2017, when Woods became CEO, through December 2019.3 ExxonMobil has been the industry leader for decades. IEEFA’s analysis concluded that under Woods, ExxonMobil’s financial performance in these critical areas has been slipping on an absolute basis and relative to its peers—Shell, Chevron, Total and BP. This slippage predates the coronavirus pandemic.

ExxonMobil’s slippage during the three years of Woods’s tenure has pulled down the company’s all-important 10-year averages for the financial measures. This is significant because the company’s business model values long-term performance over annual figures, noting the capital-intensive nature of its business.

The judgment of Woods’s effectiveness as CEO reflects an uncritical treatment of the company’s own data and its measurements of performance. The data is clear: ExxonMobil’s financials are in trouble and getting worse. The current leadership under Woods has led the company toward greater losses, and the board has a clear decision to make.

Tom Sanzillo

Tom Sanzillo is Director of Financial Analysis for IEEFA. He has produced influential studies on the oil, gas, petrochemical and coal sectors in the U.S. and internationally, including company and credit analyses, facility development, oil and gas reserves, stock and commodity market analysis, and public and private financial structures.

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Kathy Hipple

Former IEEFA Financial Analyst Kathy Hipple is a founding partner of Noosphere Marketing and the finance professor at Bard’s MBA for Sustainability.

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