9 months ago
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ExxonMobil, the world’s largest non-state oil company, is a member of hundreds of trade associations around the globe working to promote the interests of the oil and gas industry. So why did its recent departure from a single trade association make news? The answer concerns the history of disinformation shared by many oil and gas trade associations, and shareholders’ recent success in exposing—and pushing back against—their tactics.
In its recent Climate Lobbying Report, ExxonMobil announced it had withdrawn its membership in the Independent Petroleum Association of America (IPAA), a Washington, DC-based organization founded in 1929 to represent “independent,” i.e. smaller, oil and gas producers. The reason given for the 2022 withdrawal (lobbying reports lag by a year) is IPAA’s “misalignment” with ExxonMobil’s stated goal of “helping society achieve its ambition for a net-zero future.”
The ExxonMobil lobbying report evaluated 56 trade associations—the 5% of its memberships the company estimates are active on climate policy—on their climate positions. This assessment wasn’t ExxonMobil’s idea, but was compelled by a successful shareholder resolution that was part of a 2021 investor revolt against the industry’s climate inaction that ultimately displaced several members of ExxonMobil’s Board of Directors.
ExxonMobil’s withdrawal from IPAA is a victory for civil society organizations and shareholders pressuring major oil and gas corporations to stop spreading climate disinformation and blocking climate policy. But a wave of such victories in recent years has created blowback from those corporations and their proxies that threatens to roll back this progress. And a look at the groups ExxonMobil remains allied with suggests IPAA may just be an embarrassing outlier.
Trading in disinformation
In its climate lobbying report, ExxonMobil deemed 52 associations “aligned” for acknowledging the risks of climate change, publicly backing the Paris Agreement goal of limiting average global warming to well below 2 degrees Celsius and taking steps to reduce carbon emissions. Three trade associations—the Louisiana Mid-Continent Oil and Gas Association, Texas Oil and Gas Association, and American Fuel and Petrochemical Manufacturers (AFPM)—were identified as “partially aligned” for failing to fully support these positions.
ExxonMobil cited IPAA’s lack of support for policies related to climate change or reducing carbon emissions, as well as its opposition to strong methane regulations, as reasons for ending its membership (IPAA was also classified as “misaligned” two years ago in the company’s inaugural lobbying report, but the company maintained its membership). However, IPAA’s “policy positions and areas of work including and beyond climate” also contributed to its ouster, according to the report.
What could those “areas of work” be, you ask? Consider IPAA’s website Energy in Depth (EID), which attacks UCS and other climate accountability experts while promoting disinformation, such as claims that fossil gas and fracking benefits the environment. Fracking company XTO Energies, acquired by ExxonMobil in 2010, helped fund the site’s launch in 2009, along with oil supermajors Chevron, BP, and Shell.
Smoke screens for oil and gas
UCS has documented how ExxonMobil and other major fossil fuel companies hide behind trade associations and front groups to do their lobbying and disinformation dirty work, and EID is a prime example. FTI Consulting, a PR agency hired to help run EID that has several oil companies as clients, said the site’s value lies in its “ability to say, do and write things that individual company employees cannot and should not,” according to files obtained by the Climate Investigations Center. FTI has expertise in this area: It has run several “astroturf” campaigns for the fossil fuel industry in which the agency creates websites for seemingly local grassroots groups that parrot industry concerns. FTI also collaborated with IPAA on The ESG Center, a website dedicated to spreading disinformation about fossil fuel’s importance to environmentally conscious investing, such as oil and gas providing “improved air quality for the entire global population.” (To be clear, this is preposterous.)
Former FTI employees told the New York Times that their client ExxonMobil had a hand in the direction of EID. Is ExxonMobil still funding EID, directly or indirectly? It’s impossible to say without company disclosure since EID doesn’t list its funders. However, FTI has recently reappeared on IPAA’s tax filings after disappearing for several years, possibly in reaction to news stories and Congressional subpoenas about the firm’s work for EID. FTI received more than $4 million from IPAA over the past three years, according to the filings.
Meanwhile, many of the associations ExxonMobil retains membership in are actively obstructing climate progress. For example, AFPM opposes renewable fuel standards, supports increasing domestic oil and gas production on public and private lands, and argues that the EPA has no authority to regulate greenhouse gas emissions. ExxonMobil labeled AFPM “misaligned” in 2021 but maintained its membership, and the association graduated to “partially aligned” in 2022 by publishing a statement claiming to support the Paris climate goals on its web site. Shell and BP made headlines for withdrawing from AFPM (in 2019 and 2020, respectively) because of the association’s climate positions, or lack thereof.
The largest recipient of ExxonMobil’s trade-association dollars, the American Petroleum Institute (API), also has a long history of spreading climate science disinformation. An infamous 1998 internal memo by an API task force laid out a plan to deliberately cast doubt on the public’s understanding of climate science, even though API’s members were reportedly warned of the dangers their products posed to the global climate more than 40 years earlier. Several lawsuits filed by states and cities against oil and gas companies for their role in climate change also name API as a plaintiff.
Success brings backlash
Investors and environmental activists forced ExxonMobil’s assessment of its trade association memberships with the successful passage of a resolution filed by asset management company BNP Paribas in 2021. Investors worked for years to pressure companies to align their lobbying and public relations activities with their public positions on social and environmental issues like climate change and human rights. Dissonance between public positions and private activity can amount to greenwashing, creating financial and reputational risks for companies and their shareholders.
These successes prompted a massive effort by trade associations and industry, aided by far-right donors, to demonize any evaluation of investments by environmental, social, or governance (ESG) factors as “woke” and bad for shareholders. The campaign has made inroads in the US Congress, where hearings and drafts of legislation aiming to limit ESG are clearly designed to protect trade groups and corporate profiteering, not investors. In a recent escalation of hostilities, ExxonMobil filed a lawsuit against two investors that have filed resolutions calling on the company to further reduce its carbon emissions.
ExxonMobil’s withdrawal from IPAA is certainly a positive development. However, in sworn Congressional testimony in 2021, Chair and CEO Darren Woods flatly refused to commit to stop funding groups that promote climate disinformation. Meanwhile, the company is doubling down on greenwashing while aggressively seeking to evade regulation and accountability.
ExxonMobil’s decision to cut ties with the most flagrantly obvious purveyor of disinformation in its trade association roster is not a sign that the company is on the road to reforming itself—but rather that pressure from shareholders, litigators, affected communities, Indigenous peoples, youth and other activists is working. It also shows that reaching the climate goals ExxonMobil claims to support won’t be driven by the fossil fuel industry, but by those working to hold it accountable.
