White House to Push Companies for More Disclosure on Greenhouse Gases
26 May 2016 - 12:50AM
Dow Jones News
WASHINGTON—The White House is set to propose a new rule
Wednesday that would push companies with federal contracts to
publicly disclose more information about their impact on climate
change, their efforts to address the issue, and how a warmer planet
could impact business operations.
The White House's Federal Acquisition Regulation Council, which
directs government contracts, is expected to require companies that
have contracts with the U.S. government to indicate publicly
whether they disclose their greenhouse gas emissions, their goals
to cut those emissions, and the risks a changing climate could pose
to their operations.
"The goal in this effort is to try to have better and clearer
information both about greenhouse gas emissions and accounting for
climate-related risks," Brian Deese, a senior adviser to President
Barack Obama, said in an interview. "We want to make sure that
better information is informing contracting decisions going
forward."
The rule, which is expected to be finalized this fall after a
public comment period, would affect an estimated 90% of all federal
contracts, or more than $400 billion in annual contracting
expenditures, according to the administration.
The White House announcement will coincide with meetings
Wednesday of Exxon Mobil Corp. and Chevron Corp. shareholders,
where attendees are expected to vote on resolutions that would
require the companies to disclose more information about the risks
new climate-change regulations pose to their businesses.
Both companies opposed the investor proposals, which call for
them to show how the value of their assets could fall if the world
moves toward lower-carbon energy sources. They're not expected to
pass Wednesday, but they are expected to garner a far higher
percentage of votes at each company than in previous years.
The White House rule is much less sweeping than the activist
investor efforts because it doesn't actually require any new public
disclosure of information, only reporting on whether that
information is currently disclosed. It also doesn't address the
impact of climate-change regulations.
The rule instead seeks to put companies on the record one way or
the other about whether they have revealed their greenhouse gas
emissions and goals to cut those emissions, and whether they have
considered how the effects of a warmer planet—such as an increase
in extreme weather events—could impact operations.
Administration officials say they hope the rule will add to the
public debate about climate-change risks, including events like
Wednesday's shareholder meetings of two of the U.S.'s biggest oil
and natural-gas companies.
"There are significant existing demand drivers for disclosure of
greenhouse gas emissions and climate-related risk data, including
growing calls from investors, insurers, and institutions," three
administration officials wrote in a blog item to be posted
Wednesday. "Today's announcement sends another clear market signal
that there is strong interest for disclosure of greenhouse gas
emissions and climate-related risk data government-wide."
The federal government is a major buyer of petroleum products,
often for Department of Defense operations such as jet fuel for
aircraft or diesel for Navy vessels. Exxon Mobil, Chevron and other
major oil companies routinely compete for and win such contracts,
which can extend across multiple years and stretch into the
hundreds of millions of dollars.
Write to Amy Harder at amy.harder@wsj.com and Bradley Olson at
Bradley.Olson@wsj.com
(END) Dow Jones Newswires
May 25, 2016 10:35 ET (14:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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