Securities regulators will let Exxon Mobil block shareholders from voting on a proposal that the company disclose goals for reducing greenhouse gas emissions.
Activist investors led by the New York state comptroller pushed the proposal, which urges Exxon to set annual targets in line with goals set by the 2015 Paris climate agreement.
Exxon asked the Securities and Exchange Commission in January for permission to bar the resolution.
On Tuesday, the SEC's corporate-finance division notified both sides that it would not recommend enforcement action against Exxon if the company keeps the item off its annual shareholder meeting, which is usually held in late May — in effect, a green light for Exxon to drop the matter.
An SEC lawyer says the measure would "micromanage" the company and supplant the judgment of Exxon managers and directors.
A spokesman for Irving, Texas-based Exxon declined to comment on the ruling.
New York Comptroller Thomas DiNapoli argues that a low-carbon global economy is a significant risk for Exxon and the company isn't prepared. He called the SEC ruling "a bump in the road" but vowed to keep pressing Exxon on the issue.
In recent years, Exxon has faced a bevy of shareholder resolutions about climate change and other environmental issues. In 2017, shareholders disregarded opposition from Exxon's board and approved a measure urging the company to explain how climate-change policies could affect the its business.