The heirs of John D. Rockefeller attacked ExxonMobil this week, a company that is also a descendant of the famed oil baron.
The Rockefeller Family Fund has announced that it will divest its assets from fossil fuels. In a statement posted on its website, the fund said that, due to the need to eliminate fossil fuels that contribute to climate change, it “makes little sense – financially or ethically – to continue holding investments in these companies. There is no sane rationale for companies to continue to explore for new sources of hydrocarbons.”
The Rockefeller Family Fund is a philanthropy set up by the fourth-generation descendants of John D. Rockfeller, and shouldn’t be confused with the Rockefeller Brothers Fund, the third-generation organization, which announced its decision to divest from fossil fuels in 2014. Related: Oil Prices Fall Fast On Huge Inventory Build
The Rockefeller Family Fund took a parting shot at ExxonMobil in its statement, which is the largest descendant of Standard Oil Company. “We would be remiss if we failed to focus on what we believe to be the morally reprehensible conduct on the part of ExxonMobil.” The organization said that ExxonMobil “worked since the 1980s to confuse the public about climate change’s march, while simultaneously spending millions to fortify its own infrastructure against climate change’s destructive consequences and track new exploration opportunities as the Arctic’s ice receded.”
The foundation, of course, is referring to the news reports that surfaced in 2015 which alleged that ExxonMobil has known for decades about the role that oil and gas play in fueling climate change, but actively funded campaigns to obscure the public and scientific understanding about climate change. In November 2015, the New York attorney general opened up an investigation into the oil supermajor.
“Appropriate authorities will determine if the company violated any laws, but as a matter of good governance, we cannot be associated with a company exhibiting such apparent contempt for the public interest,” the Rockefeller Family Fund wrote. The Fund’s $130 million in assets will be withdrawn from ExxonMobil, plus all coal and tar-sands companies, with proceeds redirected into investments that have some sort of social responsibility element to them. Related: Brussel’s Terror Attack Drives Europe Further Into Terrorism Rabbit Hole
ExxonMobil dismissed the divestment announcement. "It's not surprising that they're divesting from the company since they're already funding a conspiracy against us," a company spokesman told CNBC on March 23. Additionally, in a March 14 op-ed in The Los Angeles Times, Suzanne McCarron, Exxon’s vice president of public and government affairs, rejected the allegations that the company covered up climate science. “…the recent accusations against ExxonMobil make no sense — that is, until you learn that the anti-ExxonMobil campaign, and the supposedly unbiased media reports it rests upon, is in fact funded by groups actively opposed to the use of oil and natural gas,” McCarron wrote.
Separately, the divestment news came in the same week that the U.S. Securities and Exchange Commission decided that ExxonMobil must offer a climate change resolution as part of its annual shareholder proxy. The SEC sent a letter to the oil supermajor, which was seen by Reuters, saying that the company must allow shareholders to vote on whether or not to require the company to detail the risks to shareholders from climate change or potential legislation meant to address climate change.
Any legislation, such as a carbon tax, a cap-and-trade system, or other measures meant to block the production of oil and gas, would likely present a financial risk to the company and reduce shareholder value. ExxonMobil opposed the requirement to detail those risks, arguing that it already provides adequate information. The SEC disagreed. "It does not appear that Exxon Mobil's public disclosures compare favorably with the guidelines of the proposal," Justin Kisner, an attorney-adviser with the SEC, wrote in the letter, referring to a proposal by the New York Comptroller to require ExxonMobil to offer more detailed information. The Comptroller oversees New York’s $178 billion pension fund. Related: Record Loss For Petrobras As Political And Economic Crisis Worsen
“This is a major victory for investors who are working to address the risks that global warming presents to our portfolios,” NY Comptroller Thomas DiNapoli wrote in a statement. “The Securities and Exchange Commission’s determination upholds shareholders’ rights to ask for vital information. Investors need to know if ExxonMobil is taking necessary steps to prepare for a lower carbon future, particularly now in the wake of the Paris agreement. We look forward to presenting our proposal to fellow shareholders at ExxonMobil’s annual meeting.”
History has come full circle, with the descendants of one of the world’s most famous oil icons deciding that they will move their fortune, which was built on oil, away from fossil fuels. The Rockefeller Family Fund recognized their long history in making money from oil production. “But history moves on, as it must,” the organization wrote.
By Nick Cunningham of Oilprice.com
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