| ORLANDO
SENTINEL
DO SENTINEL
Energy producers, get green or
prepare to take your lumps
By Alan Farago
Special to the Sentinel
July 14, 2005
Global warming means tangible costs and real
opportunities for the world's largest corporations. But transforming
costs into opportunities desperately needs quickening. What will
it take for corporate behavior to reach a tipping point that induces
governments to change?
A recent forum on energy policy and security
at the American Museum of Natural History in New York made sense
of these entwined issues, reflecting the urgency most Americans
feel about global warming.
The event was sponsored by the Democratic
Leadership Council and broadcast on C-SPAN. Tim Wirth, president
of the United Nations Foundation, Ted Turner, the foundation's principal
donor, and former President Clinton exchanged views with audience
members.
A financial adviser to pension funds noted
that most corporate executives still believe global climate change
has not risen to the threshold of prudent management, according
to their fiduciary responsibility to shareholders.
Clinton, freer to express his views in private
life, said that it is time for corporate executives to embrace adaptation,
to protect their businesses from disruptions looming on the horizon
if carbon and other greenhouse gases are not quickly reduced.
Clinton harbors no bitterness that his administration's
initiatives were repeatedly defeated by energy corporations. It
is no secret that the U.S. Chamber of Commerce and big energy producers
invested heavily in message machinery to dispute the science of
global climate change or that the election of President Bush gave
fossil-fuel producers and marketers red-line authority to edit the
nation's energy and environmental policies.
We all own a few shares of the planet. This
fact doesn't matter on the living-room couch where my teenage boys
grudgingly yielded space as I sat down recently to read the annual
report and proxy statement of Exxon Mobil while they bickered over
the TV remote control.
Notwithstanding its blizzard of green advertisements,
ExxonMobil has been the most uncompromising of large international
energy producers pitted against the science of global warming.
In this year's proxy statement, Chairman Lee
Raymond and directors recommended against a shareholder resolution
by the Christian Brothers Investment Services, asking the corporation
to make available its research data about gaps in climate science
to defend its position on global warming -- kind of like producing
the missing 181/2 minutes in the Nixon tapes.
Of course it is easy for me to say -- I've
never been responsible for managing a balance sheet and income statement
showing $25 billion in profit in a single year. It's hard to argue
that's not success, especially at a point in history when peak oil
production may be over or quickly approaching, according to some
experts.
But another argument can be made: Corporations
that throttle energy alternatives while wringing massive profits
from diminishing oil supplies are scavengers circling around Western
civilization.
At the energy-policy forum, Clinton pointed
out that tax credits for consumers and businesses that quickly move
the United States from our dependency on fossil fuels is a "no
brainer," and deserves broad bipartisan support.
Whatever funds are lost to government treasuries
by tax credits related to transforming energy supply and consumption
will be more than compensated. The savings will grant us freedom
from the risks of fossil fuels and despotic regimes that supply
oil.
Voters can impress these points on public
officials and demand accountability at election time.
Investors in mutual or pension funds should
write to the managers of funds they own and ask them to rigorously
support investment in corporations whose management counts a sustainable
energy future equal to the importance of quarterly profits.
It is time for Wall Street managers to put
in bold print the message to executives of international corporations
that prudent management requires attention to global climate change.
There is good news. Recently, General Electric,
with business lines extending through every facet of bringing good
things to life, doubled its commitment to research and products
for a new-energy future. The company chairman and chief executive
officer, Jeffrey Immelt, called on Congress to set "clear milestones"
to reduce greenhouse gases that cause global warming.
As for ExxonMobil, I wish the company well.
I am an investor who expects it to profitably supply energy to the
world long after its assets producing fossil fuels have been sold
or written off.
But it is hard to avoid the feeling that today's
corporate executives -- insulated from the problems of America's
workers by annual compensations in the tens of millions of dollars
-- are a little like squirrels hoarding acorns before the climate
sharply changes.
Alan Farago, a writer on the environment and
politics, can be reached at alanfarago@yahoo.com. He wrote this
commentary for the Orlando Sentinel. To read about peak oil production
and the U.S. economy, go to Washington Monthly's "Crude Awakening"
by Kevin Drum: http://www.washingtonmonthly.com/features/2005/0506.drum.html |
