Myopic ExxonMobil is ignoring the planet’s future, say Rockefellers

Myopic ExxonMobil is ignoring the planet’s future, say Rockefellers

· Descendants of Standard Oil founder want action
· Shareholders call for chairman to be an outsider

Andrew Clark in New York
The Guardian, Thursday May 1 2008

Descendants of legendary oil tycoon John D Rockefeller have accused ExxonMobil of adopting a myopic approach towards alternative sources of energy and of refusing to engage in any meaningful discussion about the future of the planet.

At a feisty press conference in the penthouse suite of a luxury Manhattan hotel, members of the billionaire Rockefeller family complained that the world’s biggest oil company has repeatedly declined to listen to concerns about the direction of the business which has its roots in their ancestor’s 19th-century Standard Oil empire.

“There are an awful lot of people who are getting increasingly annoyed with Exxon,” said economist Neva Rockefeller Goodwin, a great-granddaughter of the company’s founder. “Their [Exxon’s] attitude is ‘these pesky shareholders, they act as if they own the company’.”

In an unusually public step for the usually reticent philanthropic dynasty, the Rockefellers have set out four shareholder resolutions calling for an independent chairman; a taskforce to study global warming; a reduction in Exxon’s greenhouse gas emissions; and a renewable energy policy. They cite support from 66 of John D Rockefeller’s 78 direct descendants aged 21 or over.

A significant number of institutional investors support their call for Exxon’s chief executive Rex Tillerson to hand the role of chairman to an outsider – a similar motion for such a change won 40% of investors’ votes at last year’s annual meeting.

Rockefeller Goodwin said her family “almost defines the long-term investor” as the oldest continuous shareholder in Exxon. She spoke of “serious disjunctures” between Exxon’s short-term actions and “the long-term health both of this company and of the world’s economy”.

Her cousin Peter O’Neill added: “If the next 20 years of the energy business were going to be just about oil and gas, we wouldn’t be holding this press conference.”

While other oil companies such as BP, Shell and Chevron have sought to paint themselves as green, ExxonMobil has adopted a hardline position. The Texas-based firm has $25bn (£12.6bn) of capital investment planned in exploration and research of carbon-based fuels. Its main environmental commitment is a relatively modest $100m to fund a Stanford University centre researching technical solutions to global warming.

“We think a few of those billions should go towards looking to the future and to the kind of energy this world might need,” said Rockefeller Goodwin.

She added that family members had been denied access to Exxon’s non-executive board members and that letters to independent directors had yielded stock responses drafted by company executives. Exxon’s top management, she said, consisted of veteran employees steeped in the firm’s culture. “Exxon has a very strong corporate culture – strong in good ways and not so good ways,” said Rockefeller Goodwin. “It includes an inability to listen to outsiders and an assumption that they know all the answers.”

Until recently, Exxon gave large donations to scientific institutes which disputed climate change. The company is reluctant to pump funds into environmental power forms such as wind and solar energy, arguing that such projects will not be viable until a step change in technology happens.

“We are focusing our support on research, both internally and externally, to achieve the large technological step changes that are needed,” said an Exxon spokesman.

He denied any reluctance to enter into talks: “We have met members of the Rockefeller family on many occasions over a number of years.”

The shareholder proposals are not binding and Exxon merely says that any successful resolutions will be “considered” by its board. In spite of criticism over its strategy, Exxon’s shares have surged by 20% in the last year and the firm commands a market value of $497bn.

The Rockefellers declined to put a figure on the number of shares they hold. But according to company figures, the 12 family members formally proposing resolutions have 332,174 shares, worth $31m but amounting to only 0.006% of the company.

Powerful Californian state pension fund Calpers has lent its support to the family, as has Connecticut’s state pension fund which holds $300m in Exxon shares. Connecticut’s state treasurer, Denise Nappier, said: “We’re trying to keep a giant, and it truly is a giant in the oil and gas industry, from falling.”

http://www.guardian.co.uk/business/2008/may/01/exxonmobil.oil

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