Exxon Mobil

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Exxon Mobil: Stakeholders Theory

What should be the role adopted by the Government to discourage profiteering by large organizations?

ExxonMobil is an American oil and gas corporation and a direct descendant of John D. Rockerfeller’s Standard Oil Company. The mereger of Exxon and Mobil on Novermber 30, 1999 led to the formation of ExxonMobil which is the worlds largest company by revenue. ExxonMobil operate facilities or market products in most of the world’s countries and explore for oil and natural gas on six continents.

The case:
ExxonMobil has drawn criticism from the environmental lobby for funding organizations critical of the Kyoto Protocol and skeptical of the scientific opinion that global warming is caused by the burning of fossil fuels. According to The Guardian, ExxonMobil has funded, among other groups skeptical of global warming, the Competitive Enterprise Institute, George C. Marshall Institute, Heartland Institute, Congress on Racial Equality, TechCentralStation.com, and International Policy Network. ExxonMobil's support for these organizations has drawn criticism from the Royal Society, the academy of sciences of the United Kingdom. The Union of Concerned Scientists released a report in 2007 accusing ExxonMobil of spending $16 million, between 1998 and 2005, towards 43 advocacy organizations which dispute the impact of global warming. The report argued that ExxonMobil used disinformation tactics similar to those used by the tobacco industry in its denials of the link between lung cancer and smoking, saying that the company used "many of the same organizations and personnel to cloud the scientific understanding of climate change and delay action on the issue." ExxonMobil has been reported as having plans to invest up to US$100m over a ten year period in Stanford University's Global Climate and Energy Project. In August 2006, the Wall Street Journal revealed that a YouTube video lampooning Al Gore, titled Al Gore's Penguin Army, appeared to be astroturfing by DCI Group, a Washington PR firm with ties to ExxonMobil.

The recent scenario:

In January 2007, the company appeared to change its position, when vice president for public affairs Kenneth Cohen said "we know enough now—or, society knows enough now—that the risk is serious and action should be taken." Cohen stated that, as of 2006, ExxonMobil had ceased funding of the Competitive Enterprise Institute and "'five or six' similar groups". While the company did not publicly state which the other similar groups were, a May 2007 report by Greenpeace does list the five groups it stopped funding as well as a list of 41 other climate skeptic groups which are still receiving ExxonMobil funds. On February 13, 2007, ExxonMobil CEO Rex W. Tillerson acknowledged that the planet was warming while carbon dioxide levels were increasing, but in the same speech gave an unqualified defense of the oil industry and predicted that hydrocarbons would dominate the world’s transportation as energy demand grows by an expected 40 percent by 2030. Tillerson stated that there is no significant alternative to oil in coming decades, and that ExxonMobil would continue to make petroleum and natural gas its primary products. A survey carried out by the UK's Royal Society found that in 2005 ExxonMobil distributed $2.9m to 39 groups that the society said "misrepresented the science of climate change by outright denial of the evidence". On July 1, 2009, the Guardian newspaper revealed that ExxonMobil has continued to fund organizations including the National Center for Policy Analysis (NCPA) along with the Heritage Foundation, despite a public pledge to cut support of lobby groups who deny climate change.

ExxonMobil's environmental record has been a target of critics from outside organizations such as Greenpeace as well as some institutional investors who disagree with its stance on global warming.The Political Economy Research Institute ranks ExxonMobil sixth among...
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