As the world's scientists issued their latest report on climate change and its risks to society, Exxon Mobil weighed in with a report of its own. The oil giant acknowledged the need to address climate change but concluded that governments are "highly unlikely" to adopt policies that severely restrict fossil fuel consumption.
A Growing Concern
Exxon's report came in response to concerns from shareholders and environmental activists that the value of its assets could be impacted by climate change policies. This issue has been gaining traction, with some arguing that as society restricts fossil fuel consumption to combat climate change, the value of these assets will decline. Exxon's report aimed to address these concerns, acknowledging the need for action on climate change while also highlighting the critical role energy plays in global development and economic growth.
A Low-Carbon Standard?
Natasha Lamb, director of equity research at Arjuna Capital, a sustainable wealth management group, hailed Exxon's report as a "milestone." However, she expressed disappointment that Exxon declined to explore what would happen if society were to adopt a low-carbon standard. This lack of transparency has led some to question whether the company is prepared for a future where fossil fuel consumption is severely restricted.
The Future of Fossil Fuels
Exxon and environmental groups agree that climate change poses a risk, but they differ on how drastic a response society will need. Exxon predicts that demand for fossil fuels will continue to grow as more people demand access to electricity, heat, and transportation. The company's report notes that emissions from energy sources will peak by around 2030 before declining as society becomes more efficient and switches to lower-carbon fuels.
A Choice Between Restricting Energy or Raising Costs
Exxon believes that renewable energy sources are not yet cheap enough or technologically advanced enough to meet growing demand for energy. As a result, governments face a choice between restricting access to energy or raising the cost of fossil fuels significantly. Exxon expects governments will choose to raise costs slightly to encourage alternatives but stop short of severely curtailing consumption.
A Different Perspective
Arjuna Capital's Lamb disagrees with Exxon's assessment, citing the risks associated with climate change itself. She argues that ignoring the consequences of inaction will have severe and far-reaching impacts on society. The latest IPCC report highlights these concerns, warning that climate change will worsen problems like poverty, sickness, violence, and displacement.
A Shift in Perspective
Exxon's report serves as a reminder that the future of fossil fuels is uncertain. As the world continues to grapple with the challenges posed by climate change, it's clear that mobile marketing strategies must adapt to this changing landscape. By acknowledging the risks associated with climate change, Exxon is taking a step towards transparency and accountability. However, the company's reluctance to explore a low-carbon standard raises questions about its preparedness for a future where fossil fuel consumption is severely restricted.
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