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Three major oil and gas firms — ExxonMobil, Royal Dutch Shell and Chevron — suffered hits in court and among their own investors Wednesday, amid pressure for businesses and governments to seriously curtail emissions that drive climate change. William Brangham explores the significance of the hits with Dr. Leah Stokes, a political scientist with expertise in environmental and energy policy.
It was a day like no other recently for several of the world's biggest oil and gas companies. Three major firms suffered hits in the court and among their own investors yesterday.
This comes as pressure is mounting from many fronts for businesses and governments to get more aggressive about curtailing the emissions that are driving the dangerous warming of our planet.
William Brangham explores the significance of these developments.
Yes, Judy, it was a stunning day.
First, citing the severe consequences of climate change, a court in the Netherlands ruled that Royal Dutch/Shell must dramatically cut its greenhouse gas emissions over the next decade.
Then, here in the U.S., a majority of Chevron's shareholders voted that the company has to do more to limit its emissions. And then ExxonMobil's shareholders, over the strong objections of management, elected two new board members, people who've both promised to act on climate change.
For more on what this all means, we have brought back Dr. Leah Stokes. She's a political scientist with particular expertise in environmental and energy policy. She teaches at U.C. Santa Barbara.
Dr. Stokes, great to have you back on the "NewsHour."
As someone who has long advocated that oil and gas companies need to do a better job with regards to their emissions, this must have been a stunning day for you.
I mean, it wasn't just one company. It was three. These are all three really big events. And they all happened to fall on the same day.
Let's talk a little specifically about the Shell ruling, which Shell has said it's going to try to appeal.
But if that ruling goes forward and the company has to curtail its emissions quite dramatically, in some ways, that's — that calls for something of a retooling of its whole business model.
Scientists released a report in 2018 which said that the whole planet has to cult cut emissions by 45 percent to limit warming to 1.5 degrees Celsius. And so what the ruling said is that Shell has to do the same thing. They need to be cutting their emissions by that 45 percent.
And, critically, it is not just their emissions from the operations that they have. It's also from the products that they sell. So, this would be a very dramatic shift in how that company operates.
But the reality is, all fossil fuel companies have to be starting to make these dramatic shifts. And they haven't really been willing to do it without pressure, whether that is from the courts or from shareholders or other activists in society.
Then, as we were talking, Exxon and Chevron both faced these internal revolts here from groups that have said basically that you guys have dithered — this is not their words, not — those are my words — you have dithered long enough about emissions, and it's time to get serious.
How meaningful do you think those interventions will actually be in those companies' policies?
Well, activists have been trying for quite a long time to get things like shareholder resolutions passed at fossil fuel companies.
So, the fact that we got such big changes yesterday at both Exxon, with the board vote — keep in mind that Exxon has 12 board members, I believe. And a relatively new organization called Engine 1 said, let's field some new candidates, some people who care about climate change.
And why did they do that? Because Exxon is doing very poorly financially. Investors who have been giving their money to this company have been seeing pretty poor returns. And so, shockingly, really large institutional investors like BlackRock, for example, said, you know what, we are going to back those candidates for the board. We want to have different voices.
At Chevron, it was a sort of resolution to get the company to similarly think about the effects of its products. So, just like the Shell ruling, which said that you have to think about, how are your products creating pollution, at Chevron, they're saying, we want you to be thinking about, what are the climate impacts of the drug, so to speak, you're selling, which is oil and gas and fossil fuels?
So, these are really big changes. And it's a tactic that activists have used for a long time, but we're starting to see breakthroughs. And I think that is because investors are seeing that continuing to prevent that climate change is not here is a bad financial decision.
Lastly, this all dovetails with some fairly surprisingly aggressive moves by the Biden administration in its infrastructure plan, clean electricity, electric vehicles.
Do you think that those elements will with withstand this pretty well-demonstrated Republican opposition to those ideas?
I'm sure hopeful that they will, because we cannot have an infrastructure package without investment in clean electricity, without investments in clean transportation.
This is really the pathway forward for job creation in this country. If fossil fuel companies are struggling financially and laying people off, we need to have investments in industries that will be employing people at really good-paying wages and cleaning up our air and our water and so much of our infrastructure across this country.
So, I think that the Biden administration and the Senate and the House Democrats are committed to true climate action, to things like a clean electricity standard, investments in vehicles, investments in clean buildings.
And I'm hopeful that, at the end of this, the Republican Party, which is very in bed with the fossil fuel industry, will not win the day, and we will see a bold American Jobs Plan coming out of Congress, hopefully this summer.
All right, Dr. Leah Stokes at U.C. Santa Barbara, always good to see you. Thank you.
Thanks for having me on.
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William Brangham is a correspondent and producer for PBS NewsHour in Washington, D.C. He joined the flagship PBS program in 2015, after spending two years with PBS NewsHour Weekend in New York City.
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