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Seeking a more business-friendly environment and better protections from abusive shareholder lawsuits, ExxonMobil plans to seek shareholder approval to reincorporate in Texas (The Wall Street Journal, subscription). The company has been incorporated in  New Jersey since 1882. 

The rationale: “Exxon Chief Executive Darren Woods told The Wall Street Journal in an interview that the move is about protecting the company from shareholder ‘abuse,’ a reference to what companies see as a proliferation of frivolous shareholder lawsuits in certain venues.”

• “Texas is already our operating home, and we think it makes sense to make it our legal home,” Woods told the Journal.

The bigger picture: The company’s board found value in the “modernized” business legislation and regulatory regime in Texas, citing the Texas Business Court for its efficiency and expertise.

• “When corporate decisions are challenged, Texas courts are required to apply clear, statute-based standards, which support sound decision-making,” the company said.
• ExxonMobil would be the first noncontrolled public company to move its corporate home to Texas.  

The word from Texas: “I thank ExxonMobil for their decision to redomicile in Texas and for their long-standing partnership with our state,” said Governor Greg Abbott.

• “With this decision, Texas will further dominate the corporate landscape and ensure our economic growth reaches new heights.”

What’s next: ExxonMobil’s shareholders will vote on the proposal at the 2026 annual meeting of shareholders on May 27.  

The NAM says: “Frivolous shareholder lawsuits are an expensive distraction for publicly traded manufacturers. It is encouraging to see states curb abusive litigation and provide a more favorable business climate for companies,” said NAM Senior Director of Corporate Finance Policy Ted Allen.