In a filing with the United States Securities and Exchange Commission on 11 December 2017, Exxon Mobil Corporation made an open commitment concerning the reporting of its climate change policies. In the filing, they wrote, “the Board has decided to further enhance the Company’s disclosures . . . and will seek to issue these disclosures in the near future.
These enhancements will include energy demand sensitivities, implications of two degree Celsius scenarios, and positioning for a lower-carbon future.”
The statement was in response to a formal proposal from the New York State Common Retirement Fund, who were joined by a coalition of investors which represent $4 Trillion in assets. According to the New York State Comptroller, 62.3 percent of ExxonMobil voting shares support the proposal, including the massive Vanguard Group.
The shareholder proposal asked Exxon to analyze how the Paris Agreement's goal of restricting global temperatures to no more than 2 degrees Celsius above pre-industrial levels will affect its business and to assess the financial risks associated with that 2-degree scenario.
Andrew Logan of Ceres, a nonprofit organization working with investors and companies to tackle sustainability challenges, including climate change, said that the announcement was an example of “the effects of collaborative investor engagement in moving companies, and a reinforcement that investors want decision-useful climate disclosures.”
“ExxonMobil’s adoption of greater climate analysis is a win for shareholders and for the company's ability to manage risk,” said New York State Comptroller Thomas P. DiNapoli. “I am pleased Exxon has agreed to undertake this important analysis. Climate change is one of the greatest threats to our pension fund’s long-term value. Exxon’s decision demonstrates that investors have the power to hold corporations accountable and to compel them to address our very real climate-related concerns. We will continue to monitor Exxon’s response to climate change as we urge the company, and others in the energy sector, to find ways that they can adapt to the growing lower carbon economy.”
Kathy Mulvey, a climate campaign accountability manager for the Union of Concerned Scientists, said that while the filing is a step in the right direction, “the company is nowhere close to retooling its business model to meet the Paris accord’s goals . . .”
When will we find out more about Exxon’s climate change policies? While some statements may come out of the Exxon Mobil Corporation 2018 Analyst Meeting in March, news on this topic will likely be made during their annual shareholders meeting, which has not yet been formally scheduled.
Sister Pat Daly, OP, from Sisters of St. Dominic of Caldwell, NJ, a longtime advocate on this issue, says, “This is just a first step. ExxonMobil now has a choice: it can conduct a 2-degree scenario analysis in a way that illuminates the risks of a low-carbon transition for investors, or it can choose to respond in a way that blurs their risk. Global investors are eager to see which path the company chooses.”
