UPDATE (5/26/20): On the eve of their annual meetings, the United States Court of Appeals for the Ninth Circuit dealt a blow to BP, Chevron, ExxonMobil and the other fossil fuel company defendants in a group of lawsuits seeking to hold the companies accountable for climate damages and preparedness. The court decisions sent the cases of San Mateo and other municipalities back to state court (where they were originally filed), and returned the San Francisco and Oakland cases to federal district court for reconsideration. While fossil fuel companies have been fighting to have these lawsuits moved to federal court, where they expect more favorable judgments, state courts will rightly hear these cases locally, where the concerns of residents are front and center. The prospect that BP, Chevron, and ExxonMobil will be held liable for climate harms should provoke additional questions from shareholders participating in tomorrow’s virtual annual meetings.
At this time every year since 2016, I’ve been on my way to Dallas for the ExxonMobil annual shareholders’ meeting. This year is different—the meeting has gone virtual due to the COVID-19 pandemic. And tomorrow actually brings a trifecta of Big Oil virtual annual meetings: BP, ExxonMobil, and Chevron. I’ll be attending the first two and my colleague Nicole Pinko the third—both of us as proxies representing climate-conscious shareholders.
Unfortunately, the virtual format of these meetings is even less conducive to meaningful engagement of corporate decisionmakers than the usual carefully controlled and choreographed in-person events. Even more unfortunately, the virtual reality these companies are peddling is still not aligned with climate reality (reminding me of the virtual reality headsets ExxonMobil distributed, without irony, to shareholders in 2016).
That’s why we’ve decided to put out our questions for the leaders of these companies ahead of the meeting—so that journalists, advocates, and activists can amplify and follow up.
What we’re asking BP
- In February, BP published its first report on the climate-related positions of its trade associations, delivering on a promise made to shareholders at last year’s AGM. Based on the review, the company decided to leave three trade associations due to misalignment on climate policy. Although BP found the American Petroleum Institute (API) to be only partially aligned, the company decided not to leave the association. Since then, API has seized the opportunity of the COVID-19 pandemic to lobby the U.S. government to roll back health and safety regulations. Given BP’s silence about the rollback, should we assume that the company supports the suspension of health and safety regulations? What, if any, time limit has BP set on its efforts to change API from within?
- In February, BP announced that it aims to reduce carbon emissions from its operations and the oil and gas it extracts to net-zero by 2050, as well as to reduce the carbon intensity of its sold products by 50 percent. We understand that you plan to announce details of your strategy in September; until then, we have more questions than answers. For example, to meet its ambition, how much is BP counting on taxpayers to fund the development and large-scale deployment of technologies such as carbon capture and storage?
What we’re asking ExxonMobil
- In March, ExxonMobil Chair and CEO Darren Woods dismissed your peers’ long-term emissions reduction pledges as nothing more than a “beauty competition.” Yet your competitors, including BP and Shell, have set emissions reduction targets that encompass not just their operations but also the end-use of their products (after all, consumers of oil and gas are using the products exactly as the manufacturers intend them to be used). BP, Shell, and other oil and gas majors have also begun to address the scientific reality that the world must reach net zero emissions by roughly mid-century to keep global warming to the target set by the Paris climate agreement. In contrast, ExxonMobil projects no emissions reductions from the energy sector through 2040, proposes no date by which emissions must reach net zero, and refuses to acknowledge responsibility for reducing end-use emissions. What advantage do you see for the company in lagging far behind its competitors on climate action?
- Two years ago, ExxonMobil left the American Legislative Exchange Council (ALEC), and last year the company distanced itself from the American Petroleum Institute’s (API’s) efforts to gut federal oversight of methane by affirming its support for federal regulation of methane emissions. Many of your oil and gas industry competitors, including BP and Shell, have gone a step farther by publicly reviewing the climate-related positions taken by their trade and industry groups—and leaving some that they consider to be misaligned on climate policy. As the COVID-19 pandemic has escalated, we have been watching with alarm the API’s lobbying, particularly the push to roll back Environmental Protection Agency (EPA) air and water pollution regulations. I have two questions in this area: 1) Why hasn’t ExxonMobil publicly repudiated API’s push for dangerous rollbacks of health and safety rules? 2) When will your company meet the emerging industry standard by publishing a trade association audit?
What we’re asking Chevron
- Some of your European competitors, including BP and Shell, have set emissions reduction targets that encompass the end use of their products (Scope 3 emissions); they have also begun to address the scientific reality that the world must reach net-zero emissions by roughly mid-century to keep global warming to the target set by the Paris climate agreement. In contrast, Chevron has set only incremental targets for reducing upstream oil and gas emissions intensity, and refuses to acknowledge responsibility for end use emissions by consumers using your fossil fuel products exactly as you intend them to be used. What advantage do you see for your company in lagging far behind its competitors on climate action?
- In the past, your company has said that you do not support all positions taken by trade associations of which you are a member as a defense of your continued membership in the American Legislative Exchange Council (ALEC). ALEC has given a platform to racist views in recent years, causing major corporations like Verizon and Comcast to sever their affiliations with the group. Given Chevron’s continued support of ALEC, how do you intend to distance yourself from hateful and damaging rhetoric? When will your company step up to its competitors and release a trade association audit identifying critical climate policy misalignment?
Activists already raised an alarm about Chevron’s environmental and human rights abuses on International Anti-Chevron Day last week. BP’s annual meeting follows new revelations by Dutch researcher and activist Vatan Hüzeir that the company knew 30 years ago about the harmful effects of its fossil fuel products on the global climate.
ConocoPhillips failed to adequately answer questions about its record on climate and Indigenous rights at its virtual annual meeting earlier this month. Royal Dutch Shell grappled with a range of climate-related questions at a shareholder engagement webcast ahead of its annual meeting—but still faced protesters abiding by social distancing guidelines and a doubling in support for a shareholder proposal calling on the company to bring its emissions reduction targets in line with the goal of the Paris Climate Agreement.
Join with UCS in calling on the world’s largest money managers to vote for climate action at this week’s Big Oil annual meetings. And check back on our blog for a roundup of results and next steps from this year’s annual meeting season.