Study: Hess, Exxon Named Leading U.S. Oil Companies For Clean-Tech Innovation, Climate Adaptation

A new study by risk analysis company Maplecroft has identified Hess and ExxonMobil as leading the oil and gas sector in the innovation of clean-tech solutions and products, the mitigation of climate change related risks and the management of carbon emissions.

Maplecroft’s Climate Innovation Indexes (CIIs) are an exhaustive study of how the 360 largest US companies manage and adapt to climate change issues. They have been developed to enable investors to identify the companies that are best placed to adapt to the physical and marketplace impacts of climate change.

Hess, ranked 6th, is the only oil firm to appear in the top 20 leaders of the CIIs, while Exxon features as the 22nd best performing company.

According the CII results, Hess and Exxon outperform their sector peers by a considerable margin. The next best performing oil major is Chevron at 97th in the ranking, followed by ConocoPhillips 107th, Marathon Oil 119th, Occidental Petroleum 120th, Devon Energy 146th, Anadarko Petroleum 159th, and Noble Energy 176th. However, all feature in the top 50% of the overall ranking.

This is the third time the CIIs have been released, with GE topping the list of best performers, alongside aluminium company Alcoa and Johnson Controls, which supplies batteries and parts to the automotive industry.

“Climate change will affect the oil sector in unexpected ways, such as altering demand for existing products based on their climate-related impacts and by driving the demand for innovative manufacturing, logistics, usage and recycling,” states Maplecroft Director, Dr Kevin Franklin. “With growing legislation and regulation in the US around emissions and climate change disclosure, companies must innovate or be left behind.”

Hess was one of the most improved companies in the index, moving up 78 places to sixth. Although this primarily relates to the company’s increased engagement with the CII process, it performed particularly well for climate adaptation. According to Maplecroft, the company has developed physical risk vulnerability maps for its U.S. assets located in coastal zones, based on weather event and sea-level rise scenarios, which estimate damages, economic loss and social impacts that may arise from climate change.

“Organisations increasingly understand the likelihood of material negative impacts on their business operations and continuity as a result of climate-related natural hazards,” adds Dr Franklin. “CII leaders in adaptation, such as Hess, take a long term view of physical climate change risks and innovate solutions to protect assets and supply chains.”

ExxonMobil’s rank of 22nd in the CII Leaders Index puts the company firmly among the 100 leading US firms in the CIIs. The company demonstrated improved performance in relation to both the management of climate change related risks and opportunities and adaptation to the physical risks of climate change. The company’s performance also reflects significant investments in numerous long-term technological climate related innovations, including algae based biofuels and fuel cell vehicles.

Maplecroft rated each company against more than 100 criteria, including: the innovation of technologies and working practices to combat the onset of climate change; management of physical climate related issues; adaption to climate-related risks, such as flooding and extreme weather events in the supply chain; and the reduction of GHG emissions.