Regardless of whether you believe in climate change or not, there’s a new target for progressives that appears to loom as large as Big Tobacco did almost two decades ago for anti-smoking forces (which ultimately extracted a landmark court settlement from the latter).
The target in question? ExxonMobil, the largest American oil company and fifth-largest by revenue globally.
After successfully killing the Keystone XL pipeline in 2015 and working to shut down hundreds of coal-based power plants, many of the same environmental organizations that contributed to those efforts now have their sights set on the large oil company. For many activists, ExxonMobil is increasingly the primary scapegoat for believers in anthropogenic global warming.
Journalists such as David Hasemyer, Lisa Song and Neela Banerjee at Inside Climate News (ICN) and Katie Jennings, Susanne Rust and Dino Grandoni at The Los Angeles Times have written that key management at the predecessor companies of ExxonMobil knew from their internal scientists about risks of climate change as early as the 1970s and chose to keep them secret from the public, media and shareholders.
ExxonMobil earned $394 billion in 2014 and was the second-most profitable American company that year. Since green activists have targeted the company, the firm’s stock price has fallen 15 percent and profits have declined 50 percent — of course, some of this is due to the worldwide freefall in oil prices since 2015.
Numerous journalists have recently reported that support on Capital Hill is gaining for the progressive viewpoint despite ExxonMobil’s longtime Washington lobbying. Rather than decrying green groups as it had in years past, the company is now taking their threats more seriously.
In November of last year, the company dispatched four executives to Washington to meet with California Democratic Congressman Ted Lieu. This was a defensive maneuver to try and forestall legislation and/or more serious remedies than a carbon emissions tax, which the firm now states it’s in favor of.
The executives made a presentation claiming that ExxonMobil stands behind “sound climate policy” and has effectively tripled its greenhouse gas reductions since 2008. But when asked about the company’s internal research and whether it had intentionally sown doubt about global warming, the firm’s executives were silent.
The effort against the oil giant has been brewing for some time. In 2012, a group of activists and two dozen academics met in La Jolla, California to discuss finding a way to hold petroleum companies accountable for global warming.
Firms like ExxonMobil had been able to avoid responsibility for the issue despite activists claiming that internal combustion engines in cars were responsible for the bulk of transportation-based emissions and were the second-largest culprit of greenhouse gas pollution after electric power plants. Strategy at the meeting focused on an attack plan similar to what had been successful with anti-tobacco efforts years earlier.
Bill McKibben, co-founder of environmental group 350.org, said that reporters investigating the company “have crossed every t and dotted every i, and clearly Exxon has no option but to try a little smear and disinformation… Exxon’s been able to work its political will for a quarter of a century — they shouldn’t be able to… If you think about it, the way they deal with journalists is kind of like the way they deal with climate science, and every bit as ugly.”
Green groups have since come up with the hashtag “#ExxonKnew” to criticize the company.
Steve Coll, the dean of the Columbia School of Journalism, has assailed ExxonMobil in the press, accusing it of disparaging graduate students at the school who had done research into internal company communications supporting the ICN and Los Angeles Times articles. Coll happens to be the author of a 2012 book titled, “Private Empire,” which was critical of the company.
“I have concluded that your allegations are unsupported by evidence,” Coll wrote to ExxonMobil Vice President for Public and Government Affairs Kenneth Cohen.
“More than that, I have been troubled to discover that you have made serious allegations of professional misconduct in your letter against members of the [Columbia] project team even though you or your Media Relations colleagues possess email records showing that your allegations are false.”
Cohen said the company had been “forced to guess” at which documents reporters were referring to when responding to the journalists’ queries, but Coll stated this was untrue.
One of the things Coll neglected to mention was that support for the Columbia research had partially been provided by funds backed by the Rockefeller family, founder of Exxon predecessor firm Standard Oil. Indeed, the Rockefellers are firmly on the side of climate activism, funding renewable energy companies worldwide and research into sustainable power for the last decade.
In the meantime, prodded by a number of activist groups, three state attorney generals including Eric Schneiderman of New York have been investigating ExxonMobil for racketeering. It’s the same laws that Schneiderman predecessor and scandal-tainted former New York governor Eliot Spitzer used to attack Wall Street firms.
Schneiderman has already served ExxonMobil with a subpoena. Veteran prosecutors say the state cases could be used to extract significant concessions from the company. Anything uncovered by the state cases could also be used in a federal investigation.
Democratic presidential hopefuls Hillary Clinton and Bernie Sanders have both asked the Justice Department to look into whether ExxonMobil deliberately deceived the public in order to maintain profit margins. Current Secretary of State John Kerry has been quoted as being in favor of a Justice Department investigation, according to a Rolling Stone interview he gave in December of last year.
ExxonMobil has hired law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP to defend itself in the New York case. Company spokesman Alan Jeffers insisted that the effect of rising greenhouse emissions “is still deeply embedded in scientific uncertainty.”
He said that activists’ efforts “would be fair if they wouldn’t lie about us and distort what we say, what we’ve done [and] our history.” He accused activists of trying to turn ExxonMobil into “some kind of James Bond villain.”
At a shareholders’ meeting last year, ExxonMobil CEO Rex Tillerson affirmed the company hadn’t invested much in renewable energy because “we choose not to lose money on purpose.”
Tillerson went on to say that “mankind has this enormous capacity to deal with adversity,” including technology to deal with inclement weather “that may or may not be induced by climate change.”
Some shareholders, including representatives of a Roman Catholic organization in Milwaukee, had supported measures to place a climate change expert on the company’s board and to issue reports on the company’s fracking business, but both were voted down at the meeting.
Tillerson wrote to shareholders that “to set aside one seat for an environmental specialist or for any single attribute or area of expertise would, in our view, not be in the best interests of the company or its shareholders because it would dilute the breadth needed by all directors to make informed decisions for the company.”
At the same time, ExxonMobil sent emissaries to try and persuade the Vatican not to accuse the company of wrongdoing in an encyclical published by Pope Francis last summer. The effort failed.
Jeff Eshelman, vice president of the oil trade group Independent Producers Association of America, has pushed back on ExxonMobil’s attackers in the media, stating that, at least in the Columbia case, some of the work “seem[s] to be funded by multimillion-dollar activists.”
Thomas Pyle, president of the American Energy Alliance, called the anti-ExxonMobil efforts “very disturbing, and the fact that these presidential candidates are running with this stuff is kind of scary.”
Two conservative groups, the Competitive Enterprise Institute and Cause of Action, have filed an IRS complaint against one of the groups pushing for racketeering charges against ExxonMobil, the Institute of Global Environment and Society.
They accuse its leader Jagadish Shukla of profiting illegally from his group’s work, and the U.S. Congressional Science, Space and Technology Committee is investigating.
As the ExxonMobil battles play out, legal observers say the cases may rest on past climate risk statements the company has made in documents such as its annual reports. Typically, the company has used boilerplate language similar to that which got oil giant British Petroleum into trouble in a 9th Circuit appeals court ruling last year.
“Energy companies and others that have made disclosures related to climate change would be well advised to carefully review their disclosures, knowing that government agencies and private entities may be scrutinizing disclosures for misstatements,” explained veteran federal prosecutor John Marti. According to Marti, the New York case may be “the tip of the iceberg” as far as scrutiny for the firm.
“[The] industry doesn’t look at this and say, ‘Too bad for Exxon,’” a fossil-fuel lobbyist said. “We say it’s very chilling, a horrible precedent, and no one wants to see themselves next.”
