A Bad Week for Big Oil

Free AI web copilot to create summaries, insights and extended knowledge, download it at here

2789

Abstract

well as increasing responsibility for their customers’ pollution.</p><p id="e947"><b>Some Takeaways</b></p><p id="613c">On a positive note, these cases show meaningful environmental action against Big Oil can be taken, existing legal frameworks can effectively hold these companies accountable for socially and environmentally harmful practices, and the world’s most powerful oil and gas companies are at the mercy of states, citizens, activists, and consumers in ways previously unseen. One might go so far as to interpret these victories as the first signs of a new era of climate activism and corporate accountability, one characterized by corporate subordination to the climate targets of the territories in which they are headquartered. In the case of Shell, for instance, the court’s ruling has demonstrated to the Shell group and other oil and gas companies around the world, that ultimately the <i>state </i>decides how climate targets will be met, not the companies. As such, the ruling can be expected to embolden a wide range of environmentally conscious actors, organizations, and investors to take a stand against Big Oil.</p><p id="349c">These changes also raise important questions about fossil fuel companies’ responsibilities toward national and international climate targets, about which actors are included in international climate agreements, about the underlying motives and significance of these companies’ boardroom changes, and — more generally — about the future of the fossil fuel industry.</p><p id="2888">With regard to motives, it would not be surprising to see companies like these adopt more environmentally friendly strategies in an effort to avoid further governmental regulation. In the US, for instance, where both Chevron and Exxon are headquartered, President Biden’s administration has its eyes on clean energy and aims to drastically slash carbon emissions. In such cases, cooperation with state targets would appear to be in Big Oil’s best interest.</p><p id="0b90">Yet, corporations’ decisions to limit emissions and accelerate renewable energy development seems to be driven by more than perceived vulnerability (after all, don’t companies like these have a tendency to relocate in more weakly regulated zones of production when states become an issue?). Not surprisingly, a key driving force here appears to be profits. In the cases of Chevron and Exxon in particular, the boardroom changes seem to have been largely motivated by perceived reductions in fossil fuel demand and shareholders’ dwindling returns — meaning that despite the optimism that these measures inspire among climate-conscious groups and individuals, Big Oil’s cooperation with climate targets continues to be motivated more by profits, the cost of renewables, and the possibi

Options

lity of strict state regulations than about the state of the planet.</p><p id="be62">Lastly, it is important to note that in all three cases, we see the deployment of an emissions-centric narrative that detracts from the productive side of the issue at hand. We must ask ourselves: What do these boardroom changes and court rulings mean for the extractive practices of these companies around the world? How vulnerable do these measures make the fossil fuel industry as a whole? Will these rulings and boardroom changes mean the end of future oil exploration projects? Will they better prevent or compensate local governments, communities, and workers for whatever social and environmental harm Big Oil’s productive activities might cause? Will companies be able to simply relocate to avoid regulation?</p><p id="e6ab">These questions need answers that Big Oil will not itself provide. The sun may be shining on those of us who care for the planet, but the momentum that this week’s victories has generated must not be taken for granted. The phasing out of fossil fuels should not be left to “environmentally conscious” shareholders who continue to anticipate profits from oil and gas, but must be driven by activists and states willing to challenge and regulate the activities of Big Oil and to push companies to invest, innovate, and accelerate the development of renewable energy.</p><p id="d851">The goal is to shutdown the fossil fuel industry altogether, not to delay this by allowing Big Oil to continue to hold on to political and economic power as they adapt their profit-driven strategies to shifting political pressures. Instead, activists and governments must continue to push against oil exploration projects, against companies’ efforts to sell us “low-carbon” or “carbon-neutral” fossil fuels while rebranding themselves in more environmentally friendly terms as “energy” companies, and resist the corporate narrative of an “organic” transition to clean energy through market dynamics (e.g. the availability of cheap renewables). Boardrooms and shareholders will not decide what the future of energy will be. We will.</p><p id="1848"><b>Related Stories by MCQ</b></p><div id="2be3" class="link-block"> <a href="https://readmedium.com/we-have-come-a-long-way-81c69a195757"> <div> <div> <h2>We Have Come a Long Way</h2> <div><h3>One less pipeline to worry about and many reasons to celebrate</h3></div> <div><p>medium.com</p></div> </div> <div> <div style="background-image: url(https://miro.readmedium.com/v2/resize:fit:320/1*cbG_VswgCV8NrEsxdMbBmQ.jpeg)"></div> </div> </div> </a> </div></article></body>

The future of energy no longer in the hands of Shell, Exxon Mobil, and Chevron

May 25, 2021 marks the beginning of a series of important victories for climate activists against fossil fuels. Here are some of the week’s highlights:

Shell

On this day, Shell lost a lawsuit brought against the company by local environmental groups, MilieuDefensie, and Friends of the Earth Netherlands, whose lawyers argued that Shell’s extractive practices violated human rights and undermined the Paris Agreement’s climate targets. While Shell’s initial plan was to reduce emissions by 20% within a decade, the court has ordered the company’s emissions be slashed 45% below 2019 levels by 2030. This means that the Shell group will be legally obligated to accelerate its energy-transition and decarbonization plans to help meet the Netherlands’ climate targets.

Exxon Mobil

On Wednesday May 26, the American Big Oil company, Exon Mobil Corp., was forced to cede two board seats to a small group of climate-concerned investors. The vote that landed the small activist hedge fund the two seats is yet another win for climate activism against Big Oil, one that will drive the company to adopt stronger measures to meet climate targets and speed up the global energy transition.

Chevron

On this same day, Chevron Corp.’s investors voted in favor of a proposal to curtail consumer-based (also called scope three) emissions, which make up more than 90% of Chevron’s emissions. The vote was a direct attack against the company’s current strategies and demonstrates stronger commitments to climate targets and stakeholders, as well as increasing responsibility for their customers’ pollution.

Some Takeaways

On a positive note, these cases show meaningful environmental action against Big Oil can be taken, existing legal frameworks can effectively hold these companies accountable for socially and environmentally harmful practices, and the world’s most powerful oil and gas companies are at the mercy of states, citizens, activists, and consumers in ways previously unseen. One might go so far as to interpret these victories as the first signs of a new era of climate activism and corporate accountability, one characterized by corporate subordination to the climate targets of the territories in which they are headquartered. In the case of Shell, for instance, the court’s ruling has demonstrated to the Shell group and other oil and gas companies around the world, that ultimately the state decides how climate targets will be met, not the companies. As such, the ruling can be expected to embolden a wide range of environmentally conscious actors, organizations, and investors to take a stand against Big Oil.

These changes also raise important questions about fossil fuel companies’ responsibilities toward national and international climate targets, about which actors are included in international climate agreements, about the underlying motives and significance of these companies’ boardroom changes, and — more generally — about the future of the fossil fuel industry.

With regard to motives, it would not be surprising to see companies like these adopt more environmentally friendly strategies in an effort to avoid further governmental regulation. In the US, for instance, where both Chevron and Exxon are headquartered, President Biden’s administration has its eyes on clean energy and aims to drastically slash carbon emissions. In such cases, cooperation with state targets would appear to be in Big Oil’s best interest.

Yet, corporations’ decisions to limit emissions and accelerate renewable energy development seems to be driven by more than perceived vulnerability (after all, don’t companies like these have a tendency to relocate in more weakly regulated zones of production when states become an issue?). Not surprisingly, a key driving force here appears to be profits. In the cases of Chevron and Exxon in particular, the boardroom changes seem to have been largely motivated by perceived reductions in fossil fuel demand and shareholders’ dwindling returns — meaning that despite the optimism that these measures inspire among climate-conscious groups and individuals, Big Oil’s cooperation with climate targets continues to be motivated more by profits, the cost of renewables, and the possibility of strict state regulations than about the state of the planet.

Lastly, it is important to note that in all three cases, we see the deployment of an emissions-centric narrative that detracts from the productive side of the issue at hand. We must ask ourselves: What do these boardroom changes and court rulings mean for the extractive practices of these companies around the world? How vulnerable do these measures make the fossil fuel industry as a whole? Will these rulings and boardroom changes mean the end of future oil exploration projects? Will they better prevent or compensate local governments, communities, and workers for whatever social and environmental harm Big Oil’s productive activities might cause? Will companies be able to simply relocate to avoid regulation?

These questions need answers that Big Oil will not itself provide. The sun may be shining on those of us who care for the planet, but the momentum that this week’s victories has generated must not be taken for granted. The phasing out of fossil fuels should not be left to “environmentally conscious” shareholders who continue to anticipate profits from oil and gas, but must be driven by activists and states willing to challenge and regulate the activities of Big Oil and to push companies to invest, innovate, and accelerate the development of renewable energy.

The goal is to shutdown the fossil fuel industry altogether, not to delay this by allowing Big Oil to continue to hold on to political and economic power as they adapt their profit-driven strategies to shifting political pressures. Instead, activists and governments must continue to push against oil exploration projects, against companies’ efforts to sell us “low-carbon” or “carbon-neutral” fossil fuels while rebranding themselves in more environmentally friendly terms as “energy” companies, and resist the corporate narrative of an “organic” transition to clean energy through market dynamics (e.g. the availability of cheap renewables). Boardrooms and shareholders will not decide what the future of energy will be. We will.

Related Stories by MCQ