Anadarko Petroleum – Greenhouse Gas Emissions (2006 – 2007)
Outcome: Successfully Withdrawn
The American Geophysical Union, the world’s largest organization of earth, ocean and climate scientists, states it is now “virtually certain” that global warming is caused by emissions of greenhouse gases (GHG) and that the warming will continue.
A 2004 report by the Bush Administration’s Climate Change Science Program stated that increases in human-derived GHG emissions are the only likely explanation for global warming over the past three decades.
Carbon regulation is growing. In 2005, the Kyoto Protocol took effect, imposing mandatory greenhouse gas limits on 148 participating nations. At least half of U.S. states are addressing global warming, through legislation, lawsuits or programs initiated by governors.
A 2004 Conference Board report declared, “The global economy will become less carbon-intensive over time…The real questions are what the pace of the transition will be and who will be the winners and losers…[B]usinesses that ignore the debate over climate change will do so at their peril.”
We believe our industry is highly exposed to climate change risk; over half of U.S. GHG emissions are from oil and gas combustion, according to the Energy Information Administration.
Analysts at Goldman Sachs, Deloitte & Touche, Booz Allen, McKinsey, Banc of America, and WestLB have publicly recognized the possible financial implications of climate change, and raised concerns about companies that do not adequately disclose them.
Industry leaders such as Shell, BP, Chevron, ConocoPhillips, Statoil, Amerada Hess, Valero and Suncor are taking actions to reduce their exposure to possible adverse impacts associated with climate related, including assuming a cost for carbon in their strategic planning, reporting on and reducing their GHG emissions, engaging in emissions trading, and investing in renewable energy. Anadarko has committed to the “ongoing collection of baseline GHG emissions data” (2004 10K), but unlike the above companies and peers XTO and Apache, has made no commitment to disclose this data or meet specified reduction targets;
According to Oil and Gas Investor, the industry’s environmental record is hurting its ability to attract strong employees. Companies like BP claim that their proactive stance on climate change helps to recruit and retain quality employees.
RESOLVED: The shareholders request that a committee of independent directors of the Board assess how the company is responding to rising regulatory, competitive, and public pressure to significantly reduce carbon dioxide and other greenhouse gas emissions and report to shareholders (at reasonable cost and omitting proprietary information) by September 1, 2006.
We believe management has a fiduciary duty to carefully assess and disclose to shareholders all pertinent information on its response to climate change. We believe taking early action to reduce emissions and prepare for standards could provide competitive advantages, and inaction and opposition to emissions control efforts could expose companies to regulatory and litigation risk, and reputation damage.
The shareholders acknowledge and applaud Anadarko’s commitment to establishing a GHG baseline, but note with concern that our company appears to lag behind its industry peers in developing and implementing a strategic and comprehensive approach to the challenges posed by climate change.