Our latest DeSmog UK epic history post looks at what happened when former BP boss Lord John Browne called for government regulation to reduce carbon emissions.
The son of a British Army officer and a Hungarian Auschwitz survivor, Browne joined the company as an apprentice in 1966 before a genuinely meteoric rise through the management, reaching the apex in 1995.
His private interests were reported to be fine cigars, antique furniture and the arts. Browne represented a new breed of businessman who publicly denounced any ideology or party political affiliation and embraced public relations as the primary role of a company leader.
He was close to the young Tony Blair and just three weeks after the general election he would send shockwaves around the world by “breaking ranks” with the rest of the oil industry by publicly endorsing the science of climate change – including immediate government regulation to reduce carbon emissions from the use of fossil fuels.
Browne took to the podium at Stanford University on 19 May 1997 and appeared to completely upset the balance of power in the great climate change battle for hearts and minds.
“The world in which we live is no longer defined by ideology,” he began. “The old spectrums of left to right and radical to conservative are still with us, but ideology is no longer the ultimate arbiter of analysis and action.
“Governments, corporations, and individual citizens have all had to redefine their roles in a society no longer divided by the Iron Curtain. A new age demands a fresh perspective on the nature of society and responsibility.”
Browne made reference to the recently published UN Intergovernmental Panel on Climate Change report and continued: “There is now an effective consensus among the world’s leading scientists and serious and well informed people outside the scientific community that there is a discernible human influence on the climate and a link between the concentration of carbon dioxide and the increase in temperature … it would be unwise and potentially dangerous to ignore the mounting concern.”
He added: “If we are to take responsibility for the future of our planet, then it falls to us to begin to take precautionary action now.”
However, the oil CEO warned against “dramatic, sudden” action that sought “at a stroke” to drastically restrict the emission of carbon through the use of fossil fuels because of the impact on economic growth and the developing world. But at the same time he committed his company to the Rio Earth Summit climate agreements.
“What we propose to do is substantial, real and measurable,” he assured his audience. “I believe it will make a difference.”
A New Alliance
The official BP website still celebrates the speech. It records: “A sceptic may have wondered why an oil and gas company executive would take such an environmentally conscious stand. But BP‘s willingness to confront environmental issues had been shaped by a long learning process that stretched across several decades.”
Browne’s speech promised a new alliance between a major oil company and the international community but it instantly caused a series of clashes and divisions. It eventually ensured the demise of the Global Climate Coalition—formed by businesses which opposed immediate action to reduce greenhouse gas emissions—and drove a permanent wedge between senior political advisors within BP itself.
The speech also divided opinion in the environment movement and created a chasm between those who remained distrustful of BP and strategists who wanted to exploit the opportunity to turn oil company against oil company.
Browne committed BP to “five steps” to tackle climate change: reduce operational greenhouse emissions, fund research and development, jointly develop new technologies, invest in alternative fuels, and “contribute to the public policy debate in the search for wider global solutions”.
Surprisingly, the energy company’s share price increased in the wake of Browne’s speech admitting fossil fuel exploitation was unsustainable.
Over the next three years, during which BP set out on a series of acquisitions and operational savings, shares rose from 359.5p to 655.4p, which was twice the rate of increase during the same period for rivals ExxonMobil.
BP also announced a $1 billion investment in solar energy, and its rival Shell followed shortly after by announcing it was investing $500 million in renewable energy technology.
Off the back of this, Greenpeace UK decided to befriend BP while increasing pressure on Shell to also commit to climate mitigation.
Browne was invited to address the Greenpeace Annual Business Conference, during which he praised his former environmentalist adversaries for their attempts to work with major businesses. He said: “We support that effort, which can only be beneficial.”
While some environmentalists believed the oil boss was sincere in his commitment, many within the company itself remained deeply sceptical and suspicious that the great climate speech would actually result in a change in practice.
Tom Burke, a former executive at Friends of the Earth and the Green Alliance, was hired by Browne as an advisor brought in to reform the organisation from the inside.
Burke remains staunchly of the view that the chief executive was sincere in his attempts to revolutionise BP from being an old, polluting, fossil fuel producer to a modern, enlightened energy company.
“John was a visionary leader and had a tremendously good sense of the challenge that faced BP in getting the scale to compete with Exxon and Shell,” Burke told me. “Browne had seen that climate change was serious and real and their own analysis told them that this was serious and real … it was a genuine attempt.”
This suggests that Browne was simply unable to drill his new climate ambitions into his own ranks, while at the same time continuing the global pursuit for new reserves in desperate and sometimes extremely hostile competition with BP‘s arch rivals at Shell and Exxon.
Sir Peter Walters was Browne’s successor at BP. As boss of the company, he signed off annual donations of £10,000 for his friend Sir Ralph Harris at the Institute of Economic Affairs (IEA) and, on retirement, joined the free market think tank as a trustee.
At the time of Brown’s Stanford Speech, Walters was working with Julian Morris and Roger Bate, overseeing climate sceptic publications and conferences. Walters also remains convinced that the sun is the driving force behind climate change.
His scepticism of the science reflects his scepticism of Browne’s true motive in coming out in support of climate action, pointing to his very close relationship with Blair.
Some of his colleagues at the IEA were incandescent with rage at Browne for breaking ranks and fraternising with their ideological foes.
Sir Peter told me during an interview at the BP headquarters in St James’s Street: “If you’re chief executive of a major company, you’ve got to work with the grain of the government. I’m not going to stand up and criticise them because I want something else. I don’t have to bend my conscience too far to say what they’ll be glad to hear.”
When asked if Browne was using rhetoric to ‘greenwash’ BP during the Stanford speech, Sir Peter replied: “When I was a soldier we had an expression in the army which was, ‘bullshit baffles brains’.
“Before the commanding general came to inspect, everything would be whitewashed and cleaned. I don’t think the general ever knew about the standard of training or the combat readiness of the troops and all the rest,” he recalled, mimicking a British general: “What! What! What!”
Richard Ritche, also a lifelong supporter of the IEA, was a political advisor to Browne at BP at the time of the speech. He agrees that the chief executive’s conversion to environmentalism was about expediency and public relations, rather than a genuine turn onto the road to Damascus.
Ritchie told me: “I have absolutely no doubt that John Browne wanted to be perceived as the greenest oil company. But when you look at his decisions, he did not allocate all the resources away from oil and gas – we would never in a million years.”
In the immediate aftermath of the speech, BP announced that it would be withdrawing from the Global Climate Coalition.
It issued a short statement which included the following quote from Browne: “The time to consider the policy dimension of climate change is not when the link between greenhouse gases and climate change is conclusively proven, but when the possibility cannot be taken seriously by the society of which we are part. We in BP have reached that point.”
Shell would follow shortly after, and the transatlantic coalition would slowly unravel. The environmentalists, by targeting shareholders and leveraging Blair’s influence over his friend Browne, had delivered a knockout blow.
The sceptics in the oil industry had lost their extremely well-funded, effective and brutal weapon in the war against climate regulations. Energy companies could not rely on openly funded, and in some ways honest, special interest-lobbying front groups.
The executives at Exxon faced the prospect of having to come to terms with climate science and rebuild their multi-billion dollar company in its entirety, from the tip of the rotary oil drill, along the pipelines and refineries, to the nozzle of the petrol pump pushed into the back of the SUV.
Or they could instead go it alone in the public relations and lobbying war. Exxon and the remaining oil companies would have to find new allies.
The year after the Stanford address, Browne was knighted by the Queen for his services to industry, and in 2001 he was elevated to the House of Lords on Blair’s recommendation to become Baron Browne of Madingley.
The next DeSmog UK epic history post portrays Lee Raymond, the Texan captain steering the Exxon ship against the rising tide of climate science.