Houston/Boston — Last December, when a week-old hedge fund named Engine No 1 challenged ExxonMobil to change its ways, laughter echoed through Wall Street circles, from the fund’s name that recalled a famous children’s book to its tiny, then-$40m stake in what was once the world’s largest publicly traded company.

Just six months later, the fund delivered a huge blow that rippled throughout the oil and gas industry. Engine No 1’s campaign forced Exxon to accept new board members who could bring about a reckoning over its business strategy and confront the risk of global climate change that many investors say Exxon has long been reluctant to address...

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