Did Exxon Deceive Its Investors on Climate Change? - Lee Wasserman, Director of the Rockefeller Family Fund, Featured in The New York Times
The New York attorney general’s office will take its case against Exxon Mobil to trial on Tuesday, arguing that one of the world’s largest oil and gas companies misled its shareholders and the public by misrepresenting the risks that climate change poses to the value of its oil and gas assets.
The lawsuit is one of several the company is facing that if successful, would force Exxon Mobil, which took in some $290 billion in revenue last year, to account for the true costs of its nature-crushing fossil fuel business, making it less competitive with wind, solar and other renewable energy sources and thus accelerating the transition to a clean-energy economy.
This is Economics 101. It’s cheap to pollute if you don’t include the costs of the damage on your books. And for the world’s oil companies, those current and future damages are nearly incalculable if you consider how climate change is leading to the collapse of the planet’s diversity, and the financial losses and human suffering that will result from rising seas and temperatures. One recent study estimates that the world’s top 20 fossil fuel companies are responsible for 35 percent of energy-related greenhouse gas emissions since 1965. Exxon Mobil was the fourth-largest contributor on the list.
What makes this especially mind-numbing is that Exxon knew for decades that its business was altering the climate but repeatedly deceived the public, just as the tobacco companies knew their cigarettes caused cancer but denied it. The attorney general’s office, now under the command of Letitia James (her predecessor, Barbara Underwood, brought the suit) argues that to mislead the investing public, Exxon “erected a Potemkin village to create the illusion that it had fully considered the risks of future climate change regulation.” But “in reality, Exxon knew that its representations were not supported by the facts and were contrary to its internal business practices.”
Exxon had denied wrongdoing and called the case politically motivated...