ExxonMobil investigated for climate change statements
Subpoena questions whether energy giant deceived public, investors
ExxonMobil is under investigation by New York’s top law enforcement officer about whether it lied to investors and the public about the risks and financial impact of climate change.
New York Attorney General Eric Schneiderman subpoenaed the firm Wednesday, seeking financial records, statements and other climate-change-related material dating to 1977, according to a government official with direct knowledge of the matter. The official discussed the issue on condition of anonymity because the subpoena and other details of the investigation remain secret.
“Exxon Mobil has included information about the business risk of climate change for many years in our 10-K, Corporate Citizenship Report and in other reports to shareholders,” ExxonMobil said in response to questions about the subpoena, which was first reported by The New York
Times.
The company’s 10-K annual report for the 2014 fiscal year stated many countries are considering regulations to reduce greenhouse gas emissions “due to concern over the risk of climate change.”
“These requirements could make our products more expensive, lengthen project implementation times and reduce demand for hydrocarbons, as well as shift hydrocarbon demand toward relatively lower-carbon sources such as natural gas” it warned, adding that new rules “may also increase our compliance costs.”
The broad investigation by Schneiderman’s office focuses on whether ExxonMobil made timely and accurate disclosures about how its climate-change research, the impact of long-term environmental shifts and any movement away from usage of fossil fuels could have on the company’s financial fortunes.
New York’s Martin Act gives the state’s attorney general broad authority to investigate suspected financial wrongdoing and how it could affect investors.
Material sought by the subpoena includes research reports showing potential causes of climate change and documents detailing how the company made business decisions and financial projections based on environmental projections, according to the official. Additionally, the subpoena seeks information about ExxonMobil’s funding of organizations involved in climatechange research, including those that challenged climate science findings. Schneiderman’s office also sought promotional materials, advertisements and flyers, as well as the firm’s disclosures in Securities and Exchange Commission filings and other statements to investors.
Investigators plan to examine whether ExxonMobil’s internal research and findings square with what the company told investors and the public.
The energy giant is the second major company under investigation by Schneiderman over climate-change statements. Peabody Energy the world’s largest private-sector coal producer, turned over documents in response to a 2013 request, and disclosed the issue the following year, the official said.
“Peabody continues to work with the New York Attorney General’s office regarding our disclosures, which have evolved over the years,” spokesman Vic Svecsaid in a statement the firm issued Thursday.
New York’s Martin Act gives the state’s attorney general broad authority to investigate suspected financial wrongdoing and how it could affect investors.