ExxonMobil – Greenhouse Gas Emissions Reduction (2008)

Outcome: 30.9%

WHEREAS
The International Energy Agency warned in its 2007 World Energy Outlook that “urgent action is needed if greenhouse gas [GHG] concentrations are to be stabilized at a level that would prevent dangerous interference with the climate system.”
ExxonMobil operates in countries that have ratified the Kyoto Protocol, obliging them to reduce GHG emissions below 1990 levels by 2012. Yet Kyoto targets may be inadequate to avert the most serious impacts of global warming. Dozens of companies, including competitors ConocoPhillips, BP America, and Shell, have endorsed calls for the US to reduce carbon emissions by 60-80% by 2050. 150 global corporations have called on world leaders to finalize a comprehensive, binding UN framework to tackle climate change, urging already industrialized nations to make the greatest efforts (11/30/07).
ExxonMobil has minimally invested in cogeneration, improved energy efficiency in refineries, reduced gas flaring, and supported climate research. For five years, ExxonMobil has stressed its donation to Stanford University’s Global Climate and Energy Project, and its partnerships with Toyota and Caterpillar on advanced fuels and engines, yet shareholders are given little information on progress or outcomes regarding these initiatives.
ExxonMobil has identified opportunities to increase operational energy efficiency by 15-20%, yet has implemented only half of these, missing potential savings of $750 million per year (Carbon Disclosure Project 5). ExxonMobil’s global energy costs for 2006 totaled $10 billion, equal to 1,475 trillion BTUs of energy.
Despite its well-publicized efforts, ExxonMobil’s global CO2 emissions increased from 2003 to 2006 – absolute operational emissions were 145.5 million metric tons in 2006, a 5.4% increase since 2005 (CDP5).
BP, Shell, ConocoPhillips, and Chevron each have significant commitments to investments in renewables, low-carbon technologies to reduce emissions, integration of the cost of carbon into strategic planning and investments, and compensation incentives for climate performance. These commitments have already enabled competitors to: secure positions in specific alternative energy markets, deliver emissions reductions, prepare for regulatory requirements, and raise their credibility in public policy debates.
Shifts in consumer preference, coupled with emissions regulations and sustained high oil prices, could significantly alter ExxonMobil’s market assumptions for the next 30 years. A March 2007 Credit Suisse report notes: “An increase in the efficiency of energy consumption and in the amount of renewable electricity production will likely lower long-term future demand growth for both oil and gas relative to current expectations.”
Proponents are concerned that ExxonMobil’s business plan appears to consider few scenarios that incorporate a decline in these markets due to forthcoming regulations and incentives, or governments’ need to stabilize global GHG emissions because of the physical risks they pose.
RESOLVED
Shareholders request that the Board of Directors adopt quantitative goals, based on current technologies, for reducing total greenhouse gas emissions from the Company’s products and operations; and that the Company report to shareholders by September 30, 2008, on its plans to achieve these goals. Such a report will omit proprietary information and be prepared at reasonable cost.