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Will Chevron Show Leadership in Climate Solutions? Notes From the 2018 Shareholders’ Meeting

Dr. Tessa Hill, , UCS | June 7, 2018, 1:42 pm EDT
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Last week, I joined the Union of Concerned Scientists at the Chevron shareholders’ meeting in San Ramon, CA. We were there to ask why Chevron leadership, and shareholders, have not pushed for more meaningful action to meet global emissions targets that would keep climate warming well below 2 degrees celsius.

The security to get into Chevron Headquarters in San Ramon was tight – more significant than your typical airport security. In addition to multiple steps of checking of our passes to enter and walking through metal detectors, we were only able to bring in paper and pen, and each of our papers were shuffled through and inspected on the way in. Once seated, we listened to the presentations by the company’s Chair and CEO and by shareholders advocating proposals on environmental, social, and governance issues. During this time, shareholders followed the Board’s recommendation to reject proposals to “transition to a low carbon business model” and improve lobbying disclosures, among other things.

During much of the meeting, I was scribbling down notes and adapting my prepared statement based upon what I was hearing. I also spent some time staring into this infographic that was provided in the Chevron Climate Resiliency Report (data from IEA 2015 World Balance and Final Consumption Report 2015):

This diagram highlights the flow of energy — the width of the bars reflects the relative size of the production/consumption budget — in our current fossil-fuel focused energy system. This diagram allows you to watch the flow of energy towards different areas of our economy that utilize that source. One remarkable aspect of this data, which is pointed out in the Climate Change Resilience Report, is that “about 25% of global oil consumption is used in personal vehicles” (to see this, follow the bar from “oil”, to “transport”, and then to “passenger”). This means every day that we drive in our personal vehicles we are making choices about fossil fuel emissions that add up to something very significant. I was struck by this statistic because it underscores something that I frequently address in my public talks about climate change: personal, individual action is one piece of the puzzle in solving the climate problem. But there are other pieces of the puzzle – government leadership and corporate accountability which I address again below.

At the end of the scheduled shareholder proposals, it was time for the lottery of Q&A. Each of us who had a question or statement had to get a numbered ticket; tickets were pulled randomly and there was no guarantee that all questions would be heard. In total, about a dozen people asked questions or made statements to the Chairman. Of these, almost all of them were on three topics: climate change, human rights, and an ongoing lawsuit with the people of Ecuador due to a decades old environmental disaster.

Here was my statement and question when my number was called:

Good morning Mr. Chairman, members of the Board, and Stakeholders. Your recent Climate Change Resilience report was a step toward responding to investor demands that you disclose your plans for operating in a world where global temperature increase is kept well below two degrees Celsius. However, your company emphasizes potential conflicts rather than synergies between climate solutions and other societal goals and dismisses a rapid transformation of our energy system as “unlikely.”

I am a scientist here in Northern California. One of the areas of my research focuses on the impact of rising carbon dioxide concentrations on the changing chemistry of the ocean. I collaborate with businesses along the coast that are deeply concerned about the impacts of rising carbon dioxide on their financial future. Specifically, rising carbon dioxide concentrations threaten a key part of our history, culture and economy of California – sustainable harvests of food from the sea. As a scientist, I understand the grave risks we are facing without deep reductions in emissions and know that swift action is precisely what is needed to avoid the worst effects of climate change.

You stated this morning, and you describe in the Climate Resilience Report, that a first principle that guides your views on climate change is that “reducing greenhouse gas emissions is a global issue that requires global engagement and action”. Yet, in this report you bet against our ability to tackle meaningful energy transformation. When will Chevron show greater ambition to keep global warming below 2 degrees C?

In his answer, Chair and CEO Michael Wirth was respectful, and thanked me for my work in the scientific community. He explained that the company simply “meets the demands of energy used by people around the world,” and that it does “look at low carbon scenarios” as part of its business plan. However, Mr. Wirth argued that global policies are needed – ones that would require government intervention – and that it isn’t the role of individual companies to make decisions on this matter. This was an interesting answer because it spelled out something that Chevron doesn’t say directly in its public report – the company isn’t planning on taking leadership on climate change until governments lead the way. Which is hard to imagine, since fossil fuel companies spend millions every year lobbying our government to support policies that promote the use of oil and gas.

Why does this matter – and why would a climate scientist attend a Chevron shareholders’ meeting? I pondered this quite a bit when I was asked to join the UCS team for the meeting that day. For me, the decision came down to three things. First, because I am asking Chevron to use the best available science to make decisions for our future. Was I being an ‘advocate’ – yes – I am advocating for the use of science in decision making. Second, because I have made a commitment to not just communicate with those who already agree with me. We need to be able to put ourselves in situations where we work to find common ground and similar values with people in many different communities. Finally, as I’ve discussed above, I think individual responsibility is an aspect of the problem – people need to feel emboldened to make their own decisions that place our planet on a better path. But individuals can’t solve this problem alone: corporate accountability is important here. We need to be asking more of corporations that contribute significantly to our greenhouse gas burden. If they contribute significantly to the problem, they should be contributing significantly to the solution.

 

Dr. Tessa Hill is a Professor and Chancellor’s Fellow at University of California, Davis, in the Department of Earth & Planetary Sciences. She is resident at UC Davis Bodega Marine Laboratory, a research station on the Northern California Coast. She is part of the Bodega Ocean Acidification Research (BOAR) group at Bodega Marine Laboratory, which aims to understand the impact of ocean acidification on marine species. Tessa leads an industry-academic partnership to understand the consequences of ocean acidification on shellfish farmers. Tessa is a Fellow of the California Academy of Sciences, a AAAS Leshner Public Engagement Fellow, and a recipient of the Presidential Early Career Award for Scientists & Engineers (PECASE).

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