Aug 3, 2018

SEC abandoning climate investigation of ExxonMobil

Photo: John Gress/Getty Images

The Securities and Exchange Commission is dropping its two-year investigation of ExxonMobil, about whether it misled its investors with regard to the risks greenhouse-gas regulations pose to the company.

Why it matters: This is a significant victory for the oil giant, which is still facing pressure from multiple attorneys general investigations and lawsuits related to its actions and climate change. The news also bodes well for the industry writ large, given any affirmative action by the SEC in this case could have had broad implications.

Between the lines: While some may see this as the Trump administration giving Exxon a pass, the SEC is an independent government agency, so the influence of politics and the White House should be much less -- nonexistent, ostensibly -- than if it were a Cabinet agency.

ExxonMobil said in a statement to Axios:

 On August 2, the United States Securities and Exchange Commission informed ExxonMobil that it has concluded its investigation of the company’s climate change disclosures, impairments, and reserves and does not intend to recommend an enforcement action against the company. The SEC initiated its investigation in January 2016, and ExxonMobil cooperated fully with the inquiry, ultimately producing more than 4.2 million pages of documents. After a thorough investigation, including a review of these documents, the SEC issued its closure letter.
As we have said all along, the SEC is the appropriate entity to examine issues related to impairment, reserves and other communications important to investors. We are confident our financial reporting meets all legal and accounting requirements. 

Go deeper: Coverage by The WSJ and Bloomberg

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