Exxon Mobil Criticized at Annual Meeting
SCOTT SIMON, host:
This is WEEKEND EDITION from NPR News. I'm Scott Simon.
There's big oil, then there's really big oil. That's ExxonMobil. How big is really big? Well record profits, more than 40 billion dollars last year, record return on capital, a remarkable 32 percent, rising share prices up 22 percent, the other big oil producers make money, but not like that. Our friend from the world of business Joe Nocera traveled Exxon Mobil's annual meeting in Dallas this week. He's back in New York and joins us from our studios. Joe, thanks for being with us.
JOE NOCERA: And thanks for having me, Scott.
SIMON: What was the mood of the meeting like?
NOCERA: It was a meeting where you expected fireworks and there were a little of that but not as much. And of course the reason everyone expected fireworks is because for the first time in the history of the company, members of the Rockefeller family were planning to use the annual meeting to complain a number of Exxon Mobil practices, which by the way they did.
SIMON: And how did that go?
NOCERA: Well from Exxon Mobil's point of view it went great. The Rockefellers sort of went out of their way to say this is an extremely well run company, which by the way it is, and on the various shareholder resolutions that they were sponsoring, several of which had to do with global warming, and one of which had to do with corporate governance, they lost pretty resoundingly.
SIMON: Tell us a bit about what the Rockefellers are trying to do.
NOCERA: Well, you know, at this point in the history of the family there are a lot of family members who are very staunch environmentalists. There were two main initiatives, one of which they backed and one of which they were the driving force. The ones they backed was an attempt to separate the chairman of the board from the CEO, make that two different jobs instead of one job as it is right now.
And then the second series of initiatives they had had to do with global warming. They want Exxon Mobil to begin to sort of take steps to prepare for a future in which climate change will affect their business. Exxon Mobil basically believes that global warming is real but that it's not gonna affect their future all that significantly for quite a while.
And a lot of the dispute is over, you know, what is the world gonna look like in 2020 or 2030. Exxon Mobil fundamentally believes that most people are still going to use oil and gas. The Rockefeller family and other many millions of people around the world basically believe that by then we will need to have gravitated away from oil and gas.
SIMON: Did anybody stand up and say why is gas so expensive? Can't we do something about that, damn it?
NOCERA: Well, if you're a shareholder of ExxonMobil, higher gas is putting money in your pocket. Rex Tillerson, the CEO of Exxon Mobil mentioned several times in the course of his remarks and at a press conference that he understands that this is inflicting a lot of pain on people, but I mean his basic position is, you know, we're not the ones setting the price of gas so it just sort of more has to do with supply and demand and with governmental policy than with Exxon Mobil. You know, he's kind of got a point.
SIMON: Is there anything Exxon Mobil could do that would change the price of gasoline?
NOCERA: Not in a fundamental way. I mean they make a ton of money, there's no question. But if they were to decide, you know, let's drop the price of oil by a nickel or a dime, it would cut pretty heavily into their profits, and it would not substantially change the price oil. Look, Scott, what's driving the price of oil is supply and demand. You know, the growing needs of China, India, Russia, Brazil, other countries that are really on the upswing economically.
And the world can only produce 85 million barrels a day. And we're kind of at 85 million barrels a day. So there's a squeeze going on that is driving up the price of oil.
SIMON: Joe, thanks for talking with us.
NOCERA: Thanks for having me, Scott.
SIMON: New York Times columnist Joe Nocera, our friend from the world of business. He's the author of a new book, "Good Guys and Bad Guys: Behind the Scenes with the Saints and Scoundrels of American Business and Everything In Between."
NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR’s programming is the audio.