This blog post was written with my colleague Theo Spencer.
When it comes to climate change, New York Attorney General Eric Schneiderman has been on a hot streak recently. Not only is his office spearheading 18 states' legal defense of the Environmental Protection Agency's Clean Power Plan to cut carbon pollution from the nation's power plants, but on the very same day he filed the states' motion in federal court, his office announced an official investigation into whether ExxonMobil repeatedly and deliberately mislead investors by downplaying the risks the company faced as a result of climate change. (More than 350,000 Americans are calling on US Attorney General Loretta Lynch to get involved in this same kind of investigation. And those citizens--we're two of them--will soon be joined by more than 20 members of Congress.)
Schneiderman's investigation into ExxonMobil, the world's third wealthiest company, comes on the heels of a settlement Schneiderman's office made with the nation's largest coal company, Peabody Energy. Under that settlement's terms, Peabody has agreed to disclose to investors more information about the risks climate change poses to its business. (The company, to date, has been one of the country's leading opponents of standards that protect against climate change, like the CPP.) According to Schneiderman's office, Peabody claimed to investors and regulators that it didn't have the ability to model the impacts of carbon pollution reductions on its business, while company documents showed clean air regulations would have a substantial impact on the company's bottom line.
On first inspection, ExxonMobil's offenses seem even worse, with the company (first as Exxon, and then, after 1999, as ExxonMobil) leading a national and global campaign of disinformation about climate change. According to the Harvard historian Naomi Oreskes, "journalists and scientists have identified more than 30 different organizations funded by the company that have worked to undermine the scientific message and prevent policy action to control greenhouse gas emissions." In the late 1990s, for instance, the company's then-chief executive, Lee Raymond, insisted the science of climate change was uncertain. That garnered lots of media attention, confused the public, and persuaded many in the business world. The fact that Exxon (and ExxonMobil) was then and is now one of the country's largest political spenders has not been lost in Washington.
Still, amidst all this denial, the company's large cadre of scientists circulated internal reports about just how serious climate change can be. "The level of corporate hypocrisy and the potential consequences are staggering," Oreskes and Congressman Ted Lieu (D-CA) have written. Indeed, ExxonMobil's disinformation campaign has stoked polarization on this issue, making what should be a scientific question into a red-hot political one instead, severely limiting our country's ability to act on climate.
Many have compared ExxonMobil's actions to those of the tobacco industry giants who continued to maintain the safety of their products while their own research proved otherwise. And, in fact, Schneiderman is investigating the oil and gas giant under two New York State laws--the Deceptive Trade Practice law and the Martin Act--that helped create a landmark settlement between tobacco companies and the states. These laws can carry civil penalties and, in the case of the Martin Act, criminal ones as well.
Peabody, under its settlement, has agreed to more complete disclosures about the risks to its business if countries around the world take more decisive action on climate.
That's an important first win for Schneiderman's office. And it's what we hope will be just the start of an important winning streak for the New York State Attorney General and the people he represents.