Earlier this week, under pressure from shareholder activists, ExxonMobil published its estimate of how much regulations aimed at blunting the impact of climate change would hurt the company’s bottom line.
Some environmentalists thought this would be a good thing, assuming that ExxonMobil would put a positive spin on any future regulation, instead of complaining that it could hurt profits, which they figured would shake shareholder confidence. If the fossil fuel giant indicated that it would be able to make money despite the prospect of new regulations — such as a carbon tax or an emissions cap — it would undermine the argument of politicians who claim that protecting the planet kills jobs.
But ExxonMobil did something different. The company said regulations such as a carbon tax won’t hurt its bottom line because… they aren’t going to happen. (Ironically, it made these statements on the same day that the UN Intergovernmental Panel on Climate Change released its report describing the devastating effect climate change could have on human society if we don’t do something to stop it very, very soon.)
And, tragically, the company is probably right. Just look at Congress. It’s the least productive session in two decades. Measures to regulate fossil fuels are no longer even up for discussion. President Obama can order the EPA to take small steps, but nothing like the sweeping tax on carbon that the shareholder activists hoped ExxonMobil would take into account is going to survive long on the Hill.
The possibility that governments would impose a stringent carbon tax between now and 2040, ExxonMobil said, is “highly unlikely.”
“Our analysis and those of independent agencies confirms our long-standing view that all viable energy sources will be essential to meet increasing demand growth that accompanies expanding economies and rising living standards,” said William Colton, ExxonMobil’s vice president of corporate strategic planning, in a press statement. “All of ExxonMobil’s current hydrocarbon reserves will be needed, along with substantial future industry investments, to address global energy needs.”
The company said it was addressing the threat of climate change by “reducing greenhouse gas emissions in its operations, helping consumers reduce their emissions, supporting research that leads to technology breakthroughs and participating in constructive dialogue on policy options.”
“That’s corporate code for: ‘Governments will allow us to keep extracting and burning fossil fuels because the economy,'” wrote Ben Adler at Grist.
Activists weren’t happy. At The Guardian, Bill McKibben summed up the statement like this: “We plan on overheating the planet, we think we have the political muscle to keep doing it, and we dare you to stop it.”
He continues:
And they’re right — unless we build a big and powerful movement, they’ll continue to dominate our political life and keep change from ever taking place.
So now, with that information clearly on the table, it’s time for college boards and foundation heads, church denominations and city mayors to act and act firmly. By divesting — by announcing that they are breaking ties with these companies — they will begin the process of politically bankrupting them. Of taking away the social license that allows them to act with such consummate arrogance, on the very day that the planet’s scientists laid bare the impact of climate change on everything from crop yields to civil wars.
It’s never fun to see one’s cynicism confirmed. But Monday was a day for reality, on the scientific front but also the political, economic, and corporate.
