Investors Take Action for Oil and Gas Accountability
May 23, 2011
The activists' rite of spring has arrived, this year with a new crop of shareholder resolutions looking to reform the oil and gas industry. In 2011 investor-owned oil and gas companies are considering a series of proposals calling for greater transparency and disclosure of chemicals used in hydraulic fracturing.
Shareholders have filed resolutions to address fracking at 9 companies total: ExxonMobil, Chevron, Ultra Petroleum, El Paso, Cabot Oil & Gas, Southwestern Energy, Energen, Anadarko and Carrizo Oil & Gas. "Oil and gas firms are being too vague about how they will manage the environmental challenges resulting from fracking," said New York State Comptroller Thomas DiNapoli in a January press release. DiNapoli's office filed a resolution with Cabot Oil & Gas asking for a specific plan to reduce or eliminate hazards from fracking. This week, shareholder advocacy group As You Sow will be moving resolutions at ExxonMobil, Chevron, and Ultra Petroleum.
So far, the votes show a strong interest among investors in sending a message to companies to take action to reduce health and environmental risks from fracking. Most dramatically, at the May 2 meeting of Energen shareholders, 49.5% of shareholders voted for the company to report on the full environmental impact of fracking operations and calling on the company to go above and beyond regulatory requirements to reduce contamination of air, water and soil from fracking and related activities.
Green Century Capital Management, CERES, As You Sow, and Investor Environmental Health Network (IEHN) helped to coordinate efforts. As Richard Liroff from the IEHN told Earthworks: Environmental hazards in lifecycle of fracking lead to risk for investors. In the absence of meaningful regulation at the federal and in many states, investors are taking on the task of holding companies accountable to improving their practices in order to reduce their exposure to risk from the companies bad practices. In the long run, a company reporting to investors on risks from fracking will lead them to managing the risks. Improved reporting improves management. And improved management means fewer families poisoned by fracking.
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