We have already learned from the Volkswagen scandal how misleading the public can affect not only a company’s bottom line, but what can happen to a company’s reputation with the public and its shareholders. We only need to look at Shell’s backing off from Arctic drilling and the resulting waste of $7 billion in shareholder funds to see the damages that bad business practices can create.
But let’s look at ExxonMobil and its track record and lack of transparency with the public and its shareholders on the potential impacts of climate change. Exxon used to be a leader in climate science. Back in 1981, believing they were protecting their business and investors, the company outfitted its largest supertanker to measure the ocean’s absorption of carbon dioxide.
Henry Shaw, now deceased, was one of Exxon’s climate scientists. Shaw and other scientists worked diligently at the cutting edge of climate research from the late-1970s to the mid-1980s, on a quest to understand the potentially devastating effects carbon dioxide could have on climate. It was Shaw’s idea to use a supertanker outfitted with the latest laboratory technology and instrumentation to study deep ocean CO2 levels.
The cover-up begins
Documents obtained by InsideClimateNews during an eight-month long investigation, show that Exxon’s top corporate executives were told by their own scientists that based on their research and unbiased findings on carbon dioxide emissions and global warming, policy changes to address climate change might affect profitability because fossil fuels were behind the CO2 emissions. After much discussion on the matter, Exxon did an about-face in 1989, and has spent the last two decades trying to discredit its own scientists’ work.
Based on the investigation into Exxon’s knowledge of the impact on climate from continuing to use fossil fuels, and the possible impacts of carbon dioxide emissions on the Earth’s climate, the company may be facing legal challenges claiming they should have acted to address the risks associated with climate change.
Exxon executive knew climate change posed an existing threat to the oil business, yet in all the company’s annual reports filed with the Security and Exchange Commission (SEC), they failed to mention this information to investors as a “material risk” as required by the SEC. This, some critics say is blatantly illegal.
Environmental activists and their political allies are hard at work, lobbying federal and state officials to launch investigations, subpoenas or prosecutions, in an attempt to find out when Exxon first knew about the negative impacts of fossil fuels on the climate. The documents obtained by InsideClimateNews will certainly help.
There is even the possibility of outlining a case for a Justice Department probe into whether Exxon violated the federal Racketeer Influenced and Corrupt Organizations Act, known as RICO, for knowingly confusing the public with company-funded oppositional bogus-science, or in other words, conspiring to keep knowledge of the impact of fossil fuels on climate away from the public.
Exxon was asked to comment on the investigation and possible litigation. Exxon spokesman Richard Keil referred to the company’s Sept. 9 statement that “from the time that climate change first emerged as a topic for scientific study and analysis in the late 1970s, ExxonMobil has committed itself to scientific, fact-based analysis of this important issue.”
