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Climate Change and the Oil Industry 2543Prelims 16/7/03 9:54 Am Page Ii 12/03 12:09 PM Page 1 ISSUES IN ENVIRONMENTAL POLITICS Multinational corporations are part of the solution to environmental Climate changeandtheoilindustry problems. The oil industry and climate change is a major case in point. Climate change This industry is closely connected to emissions of greenhouse gases. and the oil industry This volume presents a detailed study of the climate strategies of ExxonMobil, Shell and Statoil. With an innovative analytical approach, the authors explain variations at three decision-making levels: within Common problem, the companies themselves, in the national home-bases of the companies, different strategies and at the international level. The analysis generates policy-relevant knowledge about whether and how corporate resistance to a viable climate policy can be overcome. The analytical approach developed by the authors is also applicable to other areas of environmental degradation where multinational corporations play a central role. The book is invaluable to students, researchers and practitioners interested in national and international environmental politics and business environmental management. Jon Birger Skjærseth is Senior Research Fellow at the Fridtjof Nansen Institute. Tora Skodvin is a Post Doctoral Research Fellow in Political Science at the University of Oslo. Skjærseth and Skodvin Jon Birger Skjærseth and Tora Skodvin 2543prelims 16/7/03 9:54 am Page i Climate change and the oil industry 2543prelims 16/7/03 9:54 am Page ii Issues in Environmental Politics Series editors Mikael Skou Andersen and Duncan Liefferink At the start of the twenty-first century, the environment has come to stay as a central concern of global politics. This series takes key problems for environmental policy and examines the politics behind their cause and possible resolution. Accessible and eloquent, the books make available for a non-specialist readership some of the best research and most provocative thinking on humanity’s relationship with the planet. already published in the series Science and politics in international environmental regimes Steinar Andresen, Tora Skodvin, Arild Underdal and Jørgen Wettestad Congress and air pollution: environmental politics in the US Christopher J. Bailey Implementing international environmental agreements in Russia Geir Hønneland and Anne-Kristin Jørgensen The protest business? Mobilizing campaign groups Grant Jordan and William Maloney Implementing EU environmental policy Christoph Knill and Andrea Lenschow (eds) Environmental pressure groups Peter Rawcliffe North Sea cooperation: linking international and domestic pollution control Jon Birger Skjærseth European environmental policy: the pioneers Mikael Skou Andersen and Duncan Liefferink (eds) Environmental policy-making in Britain, Germany and the European Union Rüdiger K. W. Wurzel 2543prelims 16/7/03 9:54 am Page iii Climate change and the oil industry Common problem, varying strategies Jon Birger Skjærseth and Tora Skodvin Manchester University Press Manchester and New York distributed exclusively in the USA by Palgrave 2543prelims 16/7/03 9:54 am Page iv Copyright © Jon Birger Skjærseth and Tora Skodvin 2003 The right of Jon Birger Skjærseth and Tora Skodvin to be identified as the authors of this work has been asserted by them in accordance with the Copyright, Designs and Patents Act 1988. Published by Manchester University Press Oxford Road, Manchester M13 9NR, UK and Room 400, 175 Fifth Avenue, New York, NY 10010, USA www.manchesteruniversitypress.co.uk Distributed exclusively in the USA by Palgrave, 175 Fifth Avenue, New York, NY 10010, USA Distributed exclusively in Canada by UBC Press, University of British Columbia, 2029 West Mall, Vancouver, BC, Canada V6T 1Z2 British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data applied for ISBN 0 7190 6558 5 hardback First published 2003 11 10 09 08 0706050403 109 87654321 Typeset in Sabon by Action Publishing Technology Ltd, Gloucester Printed in Great Britain by Bell & Bain Ltd, Glasgow 2543prelims 16/7/03 9:54 am Page v Contents List of tables and figures page vi Preface vii Acronyms and abbreviations ix 1 Introduction 1 2 Analytical framework 12 3 The climate strategies of the oil industry 43 4 The Corporate Actor model 74 5 The Domestic Politics model 104 6 The International Regime model 158 7 Concluding remarks 196 Appendix: personal communication 221 References 223 Index 237 2543prelims 16/7/03 9:54 am Page vi List of tables and figures Tables 3.1 Summary of the climate strategies of ExxonMobil, the Shell Group and Statoil page 69 4.1 Oil and gas reserves in 2000: ExxonMobil, Shell and Statoil 77 4.2 The CA model: expected versus actual strategies in relative terms 94 5.1 Percentage expressing ‘a great deal’ of concern in the US 109 5.2 Improvement of energy efficiency in Dutch oil and gas production 126 5.3 The DP model: expected versus actual strategies in relative terms 148 Figures 3.1 ExxonMobil’s Operations Integrity Management System 47 4.1 Company structure: the Shell Group 89 4.2 Company structure: ExxonMobil 91 4.3 Company structure: Statoil 92 2543prelims 16/7/03 9:54 am Page vii Preface Climate change and a number of other environmental problems are partly, and sometimes mostly, caused by the legitimate activ- ities of large corporations. Corporations, therefore, often control the behaviour that needs to be changed to solve the problem in question. The conventional way of studying the effectiveness of international environmental regimes or domestic environmental policy is to analyse the chain of consequences flowing from policy decisions to the strategies and behaviour of target groups. In this study, we have turned this research approach upside down by taking non-state target groups, i.e. large corporations, as our point of departure. Instead of starting out with joint international commitments or national policy goals, we have focused on corpo- rate climate strategies. Why do corporations apparently operating within very similar business contexts nevertheless choose differ- ent strategies to confront a common problem? Which conditions trigger changes in corporate strategies? The consequences of this ‘bottom-up’ approach immediately became clear when we planned this study: fact-finding had to start at the corporate level rather than at political level. In two rounds in March and November in 2000, we visited oil compa- nies in the US and Europe. We also talked with representatives of the environmental movement, government authorities and various business organisations. To us as political scientists, the business community represented a new challenge, and our under- standing of the sources of corporate strategy choice is coloured by our profession. We started our work on this study in 1999. Preliminary find- 2543prelims 16/7/03 9:54 am Page viii viii Preface ings were first presented at a side-event at COP-6 in The Hague in November 2000, and subsequently at a number of workshops and conferences. The positive feedback we received encouraged us to write a book on this topic. We got funding from the Norwegian Research Council’s PETROPOL programme. This book would never have materialised, however, without additional financial support from the Fridtjof Nansen Institute, Center for International Climate and Environmental Research, Oslo (CICERO), and Department of Political Science at the University of Oslo. Lynn A. Parker Nygaard’s help was invaluable. She helped us to make our arguments as logical and consistent as possible, and she provided language editing. Atle Christer Christiansen participated as a fact-finder in the project at an early stage. We have also benefited from his useful comments to earlier drafts. Many scholars have helped us with comments and valu- able suggestions for improvements to earlier drafts. We would particularly like to thank Arild Underdal, Jørgen Wettestad, Per Ove Eikeland, Steinar Andresen, Jon Hovi, Asbjørn Torvanger, Asbjørn Aaheim, Dag Harald Claes, Knut Alfsen and Audun Ruud. Last, but not least, we would like to thank representatives of the oil companies, environmental movement and governmental organisations for taking the time to talk with us despite their no doubt tight time schedules. The responsibility for any errors or misinterpretations rests with the authors. Jon Birger Skjærseth, Lysaker Tora Skodvin, Oslo 2543prelims 16/7/03 9:54 am Page ix Acronyms and abbreviations AGBM Ad Hoc Group on the Berlin Mandate AOSIS Alliance of Small Island States API American Petroleum Institute BA benchmark agreement BAT best available technology BP British Petroleum BTU British thermal unit CA Corporate Actor CAN Climate Action Network CCAP Climate Change Action Plan CDM clean development mechanism CHP co-generation of heat and power CNE Climate Network Europe CO2 carbon dioxide COP Conference of the Parties DoE Department of Energy DP Domestic Politics ECCP European Climate Change Programme EEB European Environmental Bureau EMAS Eco-Management and Audit Scheme (European Union) ENGO environmental non-governmental organisation EPA Environmental Protection Agency EUROPIA European Petroleum Industry Association FIELD Foundation for International Law and Development FoE Friends of the Earth GCC Global Climate Coalition GHG greenhouse gas HSE health, safety and environment ICC International Chamber of Commerce 2543prelims 16/7/03 9:54 am Page x x Acronyms and abbreviations IEA International Energy Agency IGO
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