New York Attorney General Barbara D. Underwood filed a lawsuit on Wednesday against Exxon Mobil Corp, saying that the world's largest fuel company has misled investors for years about the financial risks of climate change on its business and downplaying its expected risks.
According to the New York Times report, the suit alleges Exxon of assuring its investors that the firm has made the proper evaluations on the impact of climate change regulations on its business by using a so-called proxy cost which looks into the possible effects of future events.
These proxy figures, however, were not necessarily used in the company's internal planning or cost assumptions, the document stated.
Moreover, the fossil fuel company failed to put into account such costs that could help determine the stock volume of its oil and gas reserves. Furthermore, Exxon kept secret the value of its assets which is very significant for its investors to gauge their decisions.
The report from the Washington Post cited the statement given by the director of finance at the Institute for Energy Economics & Financial Analysis, Tom Sanzillo, who said that in essence, the attorney general is charging Exxon for keeping two separate sets of books - the one used for internal purposes, and the other for public disclosure.
The result herein is a blatant distortion of the value of the company.
In response, ExxonMobil spokesperson Scott J. Silvestri said that the New York State Attorney General has no basis on filing the lawsuit.
Silvestri discounted the charges saying that they are all baseless allegations which, as he added, are clearly vested with special interests by lobbyists and marred by political opportunism.
Moreover, the Exxon spokesman said that this lawsuit reflects the inability of the attorney general to admit that the three-year probe on the company has to bear no fruits. Silvestri maintained that Exxon hasn't done any violations or any wrongdoing to warrant such legal actions.
The Times report did clarify that the New York lawsuit does not necessarily change Exxon for its apparent contribution on global climate change through its industrial operations which primarily involve the burning of fossil fuels to convert into a much more refined crude products.
Instead, the office of the New York attorney general is suing the company strictly on the grounds of fraudulence committed against investors and shareholders.
Climate Change Initiatives
According to the Post, Exxon Mobil has been working on to polish its image on the issue of global warming and climate change.
The company recently shelled out $100 million worth of funding to tech organizations and firms that are working to reduce greenhouse gases.
