Oct. 24–Irving-based Exxon Mobil misled investors for years about the company’s financial risks from climate change regulations, according to a lawsuit filed today by New York Attorney General Barbara D. Underwood.
The New York attorney general’s office said Exxon “assured investors that it was accounting for the likelihood of increasingly stringent regulation of greenhouse gas emissions.” Meanwhile, the company failed to fully take into account the costs of greenhouse gas emissions while making investment decisions and calculating reserves and impairments.
“Instead, Exxon built a facade to deceive investors into believing that the company was managing the risks of climate change regulation to its business when, in fact, it was intentionally and systematically underestimating or ignoring them, contrary to its public representations,” Underwood said in a statement.
Exxon did not immediately comment about the lawsuit.
Although Exxon is based in Texas, New York officials often take action against major corporations since its jurisdiction includes the New York Stock Exchange and Nasdaq Stock Market. Underwood’s office also pointed out that the New York State Teachers Retirement System and New York State Common Retirement Fund have a combined $1.5 billion investment in Exxon.
The company lost a lawsuit in March that sought to have the investigation stopped. Exxon has long argued the case was politically motivated, having been coordinated behind the scenes with other Democratic-led states and environmental groups hostile to oil producer.
The state in June accused Exxon of failing to comply with subpoenas for cash-flow projections reflecting how it used so-called proxy costs to calculate the financial impact on its assets from future regulations.
New York said it wants to know exactly how the proxy cost for greenhouse gas emissions has been used in making investment decisions, corporate planning reviews, reserves estimates and evaluations for more than two dozen assets and projects.
Previously, New York City and several others cities sued major oil companies, including Exxon, over their contribution to climate change and the damage its caused. But those were dismissed by a federal judge in July.
Bloomberg contributed to this report.
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