(Bloomberg) — A first-time activist investor with a tiny stake in Exxon Mobil Corp. scored a historic win in its proxy fight with the oil giant, signaling the growing importance of climate change to investors.

Engine No. 1 won at least two board seats at Wednesday’s annual shareholders meeting, according to a preliminary tally. The little-known firm vaulted into the spotlight in December when it began agitating for change at Exxon, including a diversification of its business, the alignment of executive pay with shareholder interests, and a better plan to fight global warming.

The result is one the biggest activist upsets in recent years and an embarrassment for Exxon. It’s also unprecedented in the rarefied world of Big Oil, and a sign that institutional investors are increasingly willing to force corporate America to tackle climate change. That Engine No. 1, with just a 0.02% stake and no history of activism in oil and gas, could notch up even a partial victory against the Western world’s biggest crude producer shows that environmental concerns are resonating all the way to the top of the largest U.S. companies.

The vote is also striking because of the force with which Exxon battled the activist, which also criticized the company for its lackluster financial performance. Exxon refused to to meet with the nominees and Chief Executive Officer Darren Woods told shareholders earlier this month that voting for them would “derail our progress and jeopardize your dividend.” The company even went as far as to pledge, just 48 hours before the meeting, that it will add two new directors, including one with “climate experience.”

READ: Exxon Activist Battle Turns Climate Angst Into Referendum on CEO

“This historic vote represents a tipping point for companies unprepared for the global energy transition,” CalSTRS, which had supported Engine No. 1, said in a statement after the meeting. “While the ExxonMobil board election is the first of a large U.S. company to focus on the global energy transition, it will not be the last.”

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In other corners of the commodities sector, shareholders this year have already shown frustration with executives’ reluctance to embrace tough environmental goals. On the same day that Exxon investors met, management at Chevron Corp. were rebuked by their shareholders who voted for a proposal to reduce emissions from the company’s customers. DuPont de Nemours Inc. recently suffered an 81% vote against management on plastic-pollution disclosures, while ConocoPhillips lost a contest on adopting more stringent emission targets.

Also on Wednesday, Royal Dutch Shell Plc was ordered by a Dutch court to slash its emissions harder and faster than planned, a ruling that may have consequences for the rest of the fossil fuel industry.

The Exxon meeting proved to be a nail-biting conclusion to a monthslong proxy fight. Exxon halted proceedings at one point to allow more time for vote counting. San Francisco-based Engine No. 1 accused the company of making a “last-ditch attempt to stave off much-needed board change.”

The successful Engine No. 1 nominees were Gregory Goff, former CEO of refiner Andeavor, and environmental scientist Kaisa Hietala. Earlier this month, Exxon described all four dissident nominees as “unqualified.” Eight Exxon nominees were elected and two board seats remain undecided; one or both of them could potentially go to the activist.

The result shows a clear dissatisfaction with Woods’ strategy, despite the stock’s rally this year, up more than 40% due to surging oil prices.

Woods, who retained his board seat, should be able to continue improving Exxon’s financial performance as cash flows recover, securing the S&P 500’s third-largest dividend and leaving behind 2020’s record loss, the first in four decades. But the bigger question concerns Exxon’s energy transition strategy, considered by many shareholders to be well behind its European peers.

Exxon’s environmental record and unwillingness to embrace the transition to cleaner energy quickly enough was a key criticism in the 6-month-old proxy campaign. Engine No. 1 was scathing in its assessment of Exxon’s long-term financial performance, calling it “a decade of value destruction.”

Rather than pivot toward low-carbon fuels and selling power like its some of its rivals, Exxon is betting heavily on carbon capture and sequestration, a technology that it says needs substantial government support to be viable.

Engine No. 1 said Exxon’s marquee CCS hub in Houston “lacks any real substance” and generated nothing more than an “advertising blitz.” The fund also said Exxon’s climate targets were “distorting its long-term emissions trajectory” and its claim of being aligned with the Paris Agreement “fails the basic test of logic.”

It remains to be seen how Exxon pivots, if at all, but the message from shareholders is clear: The status quo cannot continue.

(Updates with CalSTRS comment in fifth paragraph)

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