ExxonMobil is an American oil and gas corporation and a direct descendant of John D. Rockerfeller’s Standard Oil Company. The mereger of Exxon and Mobil on Novermber 30, 1999 led to the formation of ExxonMobil which is the worlds largest company by revenue. ExxonMobil operate facilities or market products in most of the world’s countries and explore for oil and natural gas on six continents.
The case:ExxonMobil has drawn criticism from the environmental lobby for funding organizations critical of the Kyoto Protocol and skeptical of the scientific opinion that global warming is caused by the burning of fossil fuels. According to The Guardian, ExxonMobil has funded, among other groups skeptical of global warming, the Competitive Enterprise Institute, George C. Marshall Institute, Heartland Institute, Congress on Racial Equality, TechCentralStation.com, and International Policy Network. ExxonMobil’s support for these organizations has drawn criticism from the Royal Society, the academy of sciences of the United Kingdom.
The Union of Concerned Scientists released a report in 2007 accusing ExxonMobil of spending $16 million, between 1998 and 2005, towards 43 advocacy organizations which dispute the impact of global warming.
The report argued that ExxonMobil used disinformation tactics similar to those used by the tobacco industry in its denials of the link between lung cancer and smoking, saying that the company used “many of the same organizations and personnel to cloud the scientific understanding of climate change and delay action on the issue.” ExxonMobil has been reported as having plans to invest up to US$100m over a ten year period in Stanford University’s Global Climate and Energy Project. In August 2006, the Wall Street Journal revealed that a YouTube video lampooning Al Gore, titled Al Gore’s Penguin Army, appeared to be astroturfing by DCI Group, a Washington PR firm with ties to ExxonMobil.
The recent scenario:
In January 2007, the company appeared to change its position, when vice president for public affairs Kenneth Cohen said “we know enough now—or, society knows enough now—that the risk is serious and action should be taken.” Cohen stated that, as of 2006, ExxonMobil had ceased funding of the Competitive Enterprise Institute and “‘five or six’ similar groups”. While the company did not publicly state which the other similar groups were, a May 2007 report by Greenpeace does list the five groups it stopped funding as well as a list of 41 other climate skeptic groups which are still receiving ExxonMobil funds.
On February 13, 2007, ExxonMobil CEO Rex W. Tillerson acknowledged that the planet was warming while carbon dioxide levels were increasing, but in the same speech gave an unqualified defense of the oil industry and predicted that hydrocarbons would dominate the world’s transportation as energy demand grows by an expected 40 percent by 2030. Tillerson stated that there is no significant alternative to oil in coming decades, and that ExxonMobil would continue to make petroleum and natural gas its primary products.
A survey carried out by the UK’s Royal Society found that in 2005 ExxonMobil distributed $2.9m to 39 groups that the society said “misrepresented the science of climate change by outright denial of the evidence”. On July 1, 2009, the Guardian newspaper revealed that ExxonMobil has continued to fund organizations including the National Center for Policy Analysis (NCPA) along with the Heritage Foundation, despite a public pledge to cut support of lobby groups who deny climate change.
ExxonMobil’s environmental record has been a target of critics from outside organizations such as Greenpeace as well as some institutional investors who disagree with its stance on global warming.The Political Economy Research Institute ranks ExxonMobil sixth among corporations emitting airborne pollutants in the United States. The ranking is based on the quantity (15.5 million pounds in 2005) and toxicity of the emissions.In 2005, ExxonMobil had committed less than 1% of their profits towards researching alternative energy, less than other leading oil companies.
Stakeholders are entities who are directly or indirectly associated with any organisation. Any decision made by the organisation , good or bad is bound to have some effect on all of these. Stakeholders are either internal to the organisation or they may be external to the organisation. Internal stakeholders are employees, trade unions, customers , suppliers, competitors. External stakeholders are shareholders , government authorities, regulators, NGOs, pressure grps etc .
EnvironmentIt is our long-standing policy to conduct business in a manner that considers both the environmental and economic needs of the communities in which we operate. We seek to drive incidents with environmental impact to zero, and to operate in a manner that is not harmful to the environment.
HealthExxonMobil supports programs targeted to worldwide health issues because we believe that good health is a springboard to opportunity, achievement and development. Health support falls into several categories, the fight against global health pandemics, support for medical centers/hospitals, health education and health-care delivery, health and the environment, and health-related research.
SafetyWe are committed to conducting our business in a manner that protects the safety and health of our employees, contractors, customers, and the public. We strive for an incident-free workplace and have set a global safety and health goal of zero injuries and illnesses. We believe that our commitment to safe, secure, and incident-free operations will contribute to improved operations reliability, lower costs, and higher productivity.
Our worldwide spending includes contributions to nonprofit organizations as well as funds invested in social projects through various joint-venture arrangements, production-sharing agreements, projects operated by others, and contractual social bonus arrangements. In 2007, Exxon Mobil Corporation, its divisions and affiliates, and the ExxonMobil Foundation provided a combined $173.8 million in cash, goods, and services worldwide.
(excerpts from the official website of the ExxonMobil Corporation: www.exxonmobil.com )
Hence we observe that what the company say and what they practice in real life are two different things altogether. But recently,it has been a contributor to environmental causes as the company donated $6.6 million to environmental and social groups in 2007.
Stakeholders of ExxonMobil:
Customers: The environment at large suffered due to ExxonMobil’s unethical methods. The company was openly disdainful of the theory that fossil fuels were a major contributor to global warming. The company states that, “It is our long-standing policy to conduct business in a manner that considers both the environmental and economic needs of the communities in which we operate. We seek to drive incidents with environmental impact to zero, and to operate in a manner that is not harmful to the environment.” But we can conclude that the company isn’t practicing what it says. The company used same methods employed by tobacco companies and hence like the former harmed the environment and the community at large in order to earn maximum profit.
Shareholders: The shareholders are the owners of the company and thus have to bare the brunt as well. The shareholders were pressurizing the company to invest more in alternative fuels but the company rejected the idea and hence the shareholders had to face the criticism that the company faced as well due to the company’s use of unethical practices in order to maximize itsprofit.
Special interest groups: The groups which partenered with ExxonMobil (43 gropus) received a lot of criticism from various other groups for misrepresenting their work and aiding in the ruining of the environment by publishing articles that questioned global warming theories. For eg: Sallie Baliunas, an astrophysicist based at Stanford University Hoover Institution (it received 300.000 USD from the company since 1998) stated in her study that temperatures haven’t changed since significantly over the past millennia and this article was rebutted by no less than 13 other scientists. They said such institutions or people mis-represent or cherry-pick the facts in an attempt to mislead the media an the people.
Thus the integrity of such organizations is questioned in the future and the media and people become wary of other studies by other organizations due to a handful of these institutions which aide in misleading the society at large.
Competitors: The competitors of ExxonMobil such as Shell and BP followed the Koyoto protocol and dropped out of Global Climate Coalition, an industry group which questioned the Global warming theory. The company faced further criticism cause of its unethical practices and ignorance over such environmental issues and this aided the competitors which received positive reviews from the media in 1998.
The role Government can play: The small but effective amount of money invested by the company allowed to fuel doubt over global warming to delay Government action just as Big Tobacco did for over 40 years. Some of the people from the tobacco industries are said to have helped the oil giant in its unethical practices. The government should be more alert and form rules and regulations against such malpractices. Lawmakers who support reduction and limitation of green house gases emissions should be given more authority and stern action should be taken against companies such as ExxonMobil for spreading false information and hence playing havoc with the environment.
ExxonMobil has been criticized by major environmental advocacy groups. In 2003, Greenpeace listed Exxon as #1 Climate Criminal. Exxon’s alleged crimes include the sabotage of efforts to deal with climate change, the fraudulent manipulation of peer reviewed scientific studies and organizations, misleading and outright lying to the population of the USA, its government officials and the global community in general.
The company donated a large sum of money towards environmental issues in 2007 but it will take more than that to uplift the image of the company in the eyes of the environmentalists and the population. The company is still ranks #1 in the world in net income which shows that the government keep a check on such companies or the extent of the malpractices might escalate in the future.