ENGINE NO. 1

THE CLIMATE CAPITALIST

By Vivienne Walt

It was an irresistible David and Goliath tale: last May, a handful of activist investors from a tiny San Francisco investment firm named Engine No. 1 took on the $350 billion behemoth ExxonMobil—and won. Barely 18 months old, the firm spent just $12.5 million pushing climate action at Exxon, and won three seats for its candidates on its board of directors—a victory that stunned the financial industry and shook Big Oil.

Leading Engine No. 1’s campaign was CEO Jennifer Grancio, who had spent years as an executive at BlackRock, the world’s biggest asset-management company. For weeks before the meeting, Grancio lobbied Exxon’s major shareholders, arguing that the company would face serious financial problems without far-reaching environmental change. The shareholders were convinced, voting in independent board members to help shake up Exxon.

Nearly a year on, Engine No. 1 is nowhere near done. It is now pushing for a raft of changes in the biggest public companies, and mobilizing regular investors to do the same. TIME recently sat down with Grancio to discuss the firm’s splashy business moves and what comes next.

Was Engine No. 1’s ExxonMobil campaign a one-off? Or do you have other oil majors on your radar?

With Exxon, we made a rational economic argument that the company had some work to do so that it wasn’t so dependent on long-dated fossil-fuel projects. We were able to lead other asset managers to follow us, to vote to drive change at Exxon.

That’s created an opportunity for us to work behind the scenes with many other companies in the oil and gas, agriculture, and transportation sectors. We’re having very constructive conversations with a number of firms on how they’re running their businesses over time, to help them think about the