2000-2001 Shareholder Resolution Campaign

Exxon Mobil

Freeze Executive Pay During Downsizing

WHEREAS, despite record profitability in the last decade, U.S. corporations, including Exxon Mobil, have also laid off record numbers of workers, arguing that cost-cutting is one key to long-term competitiveness and increased profitability;

WHEREAS, a 1992 study by the Haas School of Business at the University of California at Berkeley found that firms with the widest pay gaps experienced lower quality products and services. A study published in the Journal of Organizational Behavior found that high levels of executive compensation generated cynicism among white collar employees;

WHEREAS, firms with large pay gaps between CEOs and other executives experience executive turnover at twice the rate of firms with a more equal distribution of pay among executives according to a 2000 study by Notre Dame University (Source: Wall Street Journal, April 6, 2000);

WHEREAS, in the week before Christmas 1999, Exxon Mobil’s CEO Lee Raymond announced the elimination of 16,000 jobs, representing 15% of the company’s workforce. Over the last two decades, Exxon Mobil has led the oil industry in layoffs, eliminating 238,000 of the 361,000 worldwide jobs Exxon and Mobil had in 1982;

WHEREAS, CEO Lee Raymond received $47 million in total compensation in 1999, 50% more than his previous year’s compensation;

WHEREAS, Mr. Raymond’s total compensation, exceeded the combined compensation of the CEOs of Amerada Hess, Chevron, Conoco, Sunoco and Texaco by 55% in 1999;

WHEREAS, we believe that asking employees to sacrifice, while at the same time rewarding executives sends a mixed message to employees, suppliers and shareholders. We believe that business success over the long term is enhanced when business is viewed as a shared enterprise in which both the rewards and sacrifices are fairly shared among all employees;

RESOLVED, shareholders request that the Board adopt an executive compensation policy that freezes the pay of corporate officers during periods of significant downsizing (layoffs involving the lesser of 5% of the company's workforce or 2,000 workers). This pay freeze shall continue for a period of one year following the layoffs.

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