Although Chevron execs like to talk about “human energy,” their pay is not tied to environmental progress. Still, the company has made significant—and transparent—health and safety commitments. It has enhanced its environmental tracking and continued to expand in both geothermal energy (generated by the heat stored beneath the earth’s surface) and gasoline additives (making cleaner liquid fuels from its large natural gas reserves could slow the rate of overall emissions).
MANAGEMENT SCORE: 15 out of 25
Chevron tracks everything from motor-vehicle accidents to carbon-dioxide emissions from customer use of its products. It doesn’t, however, incorporate all of these numbers into its managers’ reviews. “Sustainability is how we conduct ourselves,” says Maria Pica, manager of global issues and policy. “[But] it has been difficult to fully quantify the dollars and cents.” Carbon counting Chevron evaluates carbon emissions, and the possibilities for offsetting or reducing them, for all capital projects over $5 million; analyses of projects over $50 million go to the executive committee and the board, which sometimes reworks them based on future risks and liabilities.
IMPACT SCORE: 47 out of 100
Environment Chevron’s environmental impact relative to peers is respectable. In 2006, it released 68 million tons of greenhouse gases from 975 million barrels of oil, a rate of 70 tons per 1000 barrels, second best among reporting firms. It was fined $8.8 million for spilling 6,099 barrels of oil. Geothermal energy Chevron’s ads tout geothermal energy production in Southeast Asia, but company reports don’t break out details. The company says it spent $2 billion on renewable- and alternative-energy technologies--including major geothermal power capacity and hydrogen infrastructure projects--and on delivering energy-efficient services between 2000 and 2006, but it does not break down that figure. Impressively diverse Minorities represent 32% of U.S. employees and women account for 28%. Among managers, 27% are minorities (up from 20% in 2005) and 21% are women. There is only one woman on the 14-member board. Compensation and benefits CEO David O'Reilly's total compensation of $13.3 million in 2006 represented 138 times the average worker’s salary of $95,900. Chevron is one of the few Big Oil companies to offer health benefits for domestic partners in the United States. Overseas benefits vary based on the country’s norms. In Angola, for example, Chevron provides medical assistance but not health insurance. Safety Chevron had 12 workplace fatalities in 2006, but its total recordable incident rate was low among the top 10. Lobbying Chevron spent $7.5 million lobbying in 2006, just short of ExxonMobil’s rate when compared to revenues. Myanmar Chevron is the only major U.S. company remaining in Myanmar, grandfathered for having been there before U.S. sanctions went into effect. CEO David O’Reilly has dug in his heels, despite lawmakers’ pressure, telling the International Herald Tribune recently: “It isn’t going to change anything if we leave.”