While we choke on pollution, Big Oil rewards execs
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While we choke on pollution, Big Oil rewards execs
New reporting from OpenDemocracy shows executives at major oil companies were awarded millions in bonuses for acting on climate. Yes, really.
Emily Sanders is the Center for Climate Integrity’s editorial lead. Catch up with her on Twitter here.
Scientists warned this week that we could see an Arctic without sea ice as early as the 2030s — a decade earlier than expected. But I don’t have to look even that far to see symptoms of climate catastrophe. Just outside my window, the New York City skyline is unrecognizable, blurred with stifling smoke brought here by wildfires blazing across Canada. As I write this, 110 million of us across the U.S. are under air quality alerts for record-high levels of hazardous particulates that threaten to penetrate our lungs and blood. Even with the windows closed, I can smell the smoke and feel it in my eyes.
As Bill McKibben writes, “this is what a huge percentage of the world’s people breathe every single day of their lives. In fact, we should probably — in our hearts if not our lungs — be grateful for a few days like this. They bring us much much closer to the lived experience of billions of our brothers and sisters.” That’s true, at least, for those of us who don’t already live in more polluted neighborhoods and for whom the smoke didn’t pose a deadly threat to our health.
If this didn’t feel surreal enough on its own, it turns out that the fossil fuel companies that got us here are actually rewarding themselves for a job well done.
Some of the world’s biggest oil and gas majors are awarding their executives special bonuses for achieving their climate goals, according to new reporting from OpenDemocracy.
After hauling in hundreds of billions of dollars in record-breaking annual profits in 2022, oil and gas majors pulled out of their climate investments and doubled down on fossil fuels. But that didn’t stop executives at BP, Chevron, Exxon, Shell, Eni, and Total from pocketing more than $18 million combined in bonuses last year for supposedly hitting their climate targets and transitioning to clean energy, the new reporting found.
Andrew Kersley, the UK journalist who reported those findings, said he combed through the directors’ compensation or remuneration sections of companies’ annual reports, where he added up the number of executive bonuses attributed to meeting specific climate targets voted in by company shareholders.
BP, for example, handed its executives a bonus for reducing the companies’ operational emissions (Scope 1 & 2) by seven million tonnes. But as Kersley reported, “although that target was achieved, it was almost exactly counterbalanced by an increase in the amount of CO2 emissions from the burning of the fossil fuels BP sells,” for which BP’s targets don’t account.
“I think they just didn’t intend anyone who wasn’t a shareholder to read it, because it kind of speaks for itself,” Kersley said. “The bar was set unbelievably low. It’s like, ‘Congrats on protecting the environment this year, you guys! We kept our emissions exactly the same.’”
Net zero targets are often intentionally ambiguous or arbitrary, without any unifying or time-bound standard to which they could be measured. They also tend to rely on far-off technology and schemes like CCS or carbon offsets to allow for continued use of fossil fuels. Many of Big Oil’s climate targets also exclude emissions from the use of their products by consumers (or Scope 3 emissions), which make up 80 to 90% of their greenhouse gas pollution in total — among other tricks in their emissions accounting, as ExxonKnews has explained. A peer reviewed study of Big Oil’s climate pledges last year concluded that “accusations of greenwashing appear well founded.”
Chevron gave executives $896,000 for supposed progress on climate change (the lowest amount of the six companies). But the company’s climate targets also ignore its massive Scope 3 emissions, and the oil giant plans to increase spending on oil and gas exploration and production by over 25% more than it did in 2022.
Exxon, which plans to spend $23 to $25 billion on increased exploration and production of fossil fuels, gave the highest environmental bonuses of all the companies — about $6.7 million split between three executives.
“It suggests heavily that the metrics in place when the market governs itself on these issues don’t work,” said Kersley.
Even as Exxon shareholders just overwhelmingly voted down climate proposals, including one calling for the company to set emissions reductions targets that actually align with the goals of the Paris Agreement, the company could still use its purported commitment to ESG (Environmental and Sustainability Goals) to excuse its actions.
“ESG is principally a way to ensure that companies can continue to make as much money as possible — whether by examining the risks that climate change might actually pose to their operations or by burnishing their green credentials with flashy pledges,” Kate Aronoff wrote about Exxon CEO Darren Woods’ support of ESG in The New Republic. “Using” ESG in one’s day-to-day operations, ironically, doesn’t actually mean reducing fossil fuel use.”
Instead of investing in clean energy, oil companies have spent their record profits on producing more fossil fuels and enriching shareholders. They’ve also run well-funded marketing and advertising campaigns with the help of big PR firms to convince the public they’re committed to climate action. That tactic has consequences: Big Oil’s greenwashing advertisements “may readily sway individuals to adopt more positive attitudes toward fossil fuel companies’ environmental behavior than might be warranted and do so in a manner that may be difficult to counteract,” a study published last week in the journal Environmental Communication found.
“There is nothing commendable about spending hundreds of millions of lobby dollars to undermine meaningful climate action and blocking any policy that would actually reduce emissions at source,” said Rachel Rose Jackson, Director of Research and International Policy: Climate, for the nonprofit watchdog Corporate Accountability. “There's nothing honorable about spending decades burying the truth and funding junk climate science. And there's especially nothing worth celebrating about paying out cash bonuses for 'climate action' when the business practices of these oil majors are fueling a climate crisis that is killing and impacting hundreds of millions of people.”
One other thing all of the companies pocketing these bonuses have in common, though, is that every one of them is being sued for their deception and role in the climate crisis — and every one of them is fighting to avoid accountability. “You really have to start asking questions about whether you can trust these companies without outside action, be that legal action or government intervention, to do enough,” said Kersley.
ICYMI News Roundup
The world’s biggest companies have made almost no progress on limiting global warming since 2018
Air pollution in US from wildfire smoke is worst in recent recorded history
Game changing’: spate of US lawsuits calls big oil to account for climate crisis
Shell’s ‘green’ ad campaign banned in UK for being ‘likely to mislead’
While we choke on pollution, Big Oil rewards execs
I never accepted the idea of divesting shares. Like those who would buy them would be those who prefer profit over people. I guess they are the same ones that voted against reducing emissions.
The way to hit big oil he hardest is for ever more of us to find ever more ways of buying ever less of their toxic products. Think people think hard. "There are only three choices, I Fry, I Drown, I Act.