Think about it: No initiative or ground-breaking research in recent years has done more to advance the conversation on whether climate change exists than the records of an oil company that for years, has denied the existence of global warming.
The United Nations Climate Change conferences and the International Panel of Climate Change have done their part to bring governments together on this issue. But none has done as much to lend credibility to the fact that extractive industry emissions have the potential to transform the climate as we know it, than the unintended release of a single email by an Exxon researcher.
For decades, the world has fought over this issue of climate risk. Government elections have been won or lost on the accusation of conjecture. We’ve debated the data, haggled over the implications and committed vast resources to proving (or disproving) the existence of a climate phenomena still in the making. Global panels have been constructed and deconstructed to address this controversy. Governments continue to argue to this day over whether a global initiative to cut emissions, while necessary, is legally binding.
And the reason, interestingly, has little to do with scientific knowledge. The fact that Exxon first realized that there was a suspicious, but unclear connection between fossil fuel development and dying ecology in the 1980s means little to today’s efforts to decrease emissions and find more compatible energy sources. Nor really, does it have anything to do with whether the corporation supported lobbies that promoted the interests of the extractive industry.
The reason that Exxon is front and center in the news and the subject of several potential investigations, is honesty, or lack thereof.
It’s become a new focus for state and federal lawmakers these days: the concept of “buyer be ware” versus the expectation of common honesty by companies that hold the cards in misleading information. New York’s famous “blue sky” legislation, the Martin Act, has gone after securities and financial fraud since its passage in 1921. Its been used to launch investigations the New York Port Authority, AIG, Earnst & Young and JP Morgan, with the coined motto of prosecuting fraudulent acts that “have no more basis than so many feet of ‘blue sky.'” And its effectiveness lies in a clear distinction between its expectations and those of similar federal legislation. The proof of intent is not required. Rather, prosecutors are compelled to show omission or misrepresentation occurred, what the law suggests are the defining aspects of “common honesty.”
Volkswagen has also come under the scrutiny of law makers for allegedly misleading consumers. While New York’s attorney office hasn’t announced any plans to investigate the car maker, it has become the subject of numerous federal, state and international probes. The latest was launched last week by the U.S. Federal Trade Commission to determine whether the corporation is guilty of “unfair or deceptive acts or practices.”
So often honesty is summed up as a matter of consumer interest, and that businesses aren’t really responsible for liabilities that can’t clearly be tied to an intentional act or aren’t vetted before purchase. Clearly that is no longer the current definition of honest practices. But it’s worth noting that both Exxon and VW have histories that right or wrong, have drawn them into uncomfortable spotlights. Criticism of Exxon’s handling of the Exxon Valdez oil spill in 1989, the Baton Rouge benzene leak in 2012 and the Mayflower Ark. oil spill in 2013 haven’t helped the corporation’s image in recent years as an environmental steward. VW’s earlier debacle with warning lights and a 2013 recall, although much smaller than Exxon’s problems, was raised this fall as the company raced to address the diesel scandal.
No matter the public’s cynicism when it comes to large corporations, the truth is we put our most successful companies on a pedestal when it comes to honoring our expectations for honesty. And laws like the Martin Act, which possesses an unfettered power to assess injury without intent were created with that realization in mind. Among other things, it reminds corporations that today’s business decisions can have powerful implications for future generations, the climate and the credibility and success of the company, as well.