ExxonMobil 10-K Leaves Shareholders in the Dark About Climate Risks, Says Science Group
WASHINGTON (February 28, 2017)—Today, ExxonMobil released its 10-K, an annual report required by the U.S. Securities and Exchange Commission that gives a comprehensive summary of a company’s financial performance. Comparing climate risk disclosures in this year’s filing with those in last year’s, the Union of Concerned Scientists (UCS) found that ExxonMobil continues to project increased oil demand even as momentum builds toward a clean energy transformation, while failing to disclose that it is a defendant in numerous lawsuits by municipalities seeking to recover the costs of climate-related damages and preparation.
In stark contrast, other major fossil fuel companies named in the lawsuits California municipalities have filed—ConocoPhillips and Peabody Energy—explicitly mentioned the suits as a shareholder risk. Peabody Energy did so despite a court ruling (appealed by the plaintiffs) that the company is shielded from liability by its bankruptcy filing.
“ExxonMobil is dealing with risk squared,” said Kathy Mulvey, climate accountability campaign manager. “And it hasn't adequately disclosed the multiple ways in which its business model may be at risk. It's facing potentially costly litigation and international policies that could limit carbon emissions, not to mention the risks that climate impacts, such as sea level rise, post to its facilities. ExxonMobil is leaving its shareholders in the dark as climate change barrels down the tracks.”
Although ExxonMobil has stated its support for the Paris Agreement, which aims to keep increases in carbon emissions to well below 2℃ above pre-industrial levels, the company continues to project an increase in global demand for its products. In its 10-K, Exxon estimated that by 2040 demand for liquid fuels would grow to 6 million barrels per day. The company also projected energy demands in the transportation industry will increase, even though the company for the first time acknowledged that electric- and energy-efficient vehicles are on the rise.