ExxonMobil has announced plans to move its legal headquarters from New Jersey to Texas, citing the state’s business-friendly policies.
The board of the largest US-based oil producer recommended that shareholders approve changing the legal domicile to Texas in light of the state’s legal and regulatory environment, including its modernised business statutes and the Texas Business Court, which is designed to resolve complex disputes efficiently.
ExxonMobil said Texas courts are required to apply clear, statute-based standards, which support sound decision-making.
“Over the past several years, Texas has made a noticeable effort to embrace the business community. In doing so, it has created a policy and regulatory environment that can allow the company to maximise shareholder value,” said Darren Woods, ExxonMobil Chairman and CEO.
“Aligning our legal home with our operating home, in a state that understands our business and has a stake in the company’s success, is important.”
Shareholders will vote on the change at the company’s annual meeting on May 27. If approved, the company will move back to Texas after it relocated its headquarters in 1989.
Approximately 30 per cent of ExxonMobil’s global employees are located in Texas, with most remaining employees based outside the US.
Texas is also the centre of the company’s executive leadership, corporate functions, major research facilities and workforce.
ExxonMobil’s connection to New Jersey is largely historical, dating back to the 1882 incorporation of Standard Oil of New Jersey.
The company said its proposed redomiciliation will not affect business operations, management, strategy, assets, or employee locations. Nor will changing ExxonMobil’s legal domicile reduce shareholder rights.
The board also determined that shareholder rights under Texas law are largely comparable to those under New Jersey law and in some areas stronger.
