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ExxonMobil: The Corporation as Sovereign

Journalist Steve Coll discusses his reporting on the oil giant and the responsibilities of corporations

Steve Coll, center, talks with journalist and Sanford School professor Phil Bennett and Sanford Dean Bruce Kuniholm.  Photo by Megan Morr/Duke University Photography
Steve Coll, center, talks with journalist and Sanford School professor Phil Bennett and Sanford Dean Bruce Kuniholm. Photo by Megan Morr/Duke University Photography

The telling moment for journalist Steve Coll while reporting on oil giant ExxonMobil was when the company's CEO was asked whether they should build more refineries in the United States, to protect the country from a potential oil shortage.  "We're not a U.S. corporation," Lee Raymond replied.

For Coll, winner of two Pulitzer Prizes and author of "Private Empire: ExxonMobil and American Power," those words raised deep questions about the ethical, social and political responsibilities of corporations.

The reality, Coll told an audience at the Sanford School of Public Policy Tuesday, is that ExxonMobil "is conscious of its own sovereignty in this world."

"The company doesn't see itself as a U.S. entity," said Coll. "It sees itself as a global sovereign.  It operates in more than 100 countries and its annual revenue of $450 billion rivals that of countries as large as Norway."

As such, ExxonMobil conducts its own foreign policy and has its own security team. Sometimes its interests align with those of the United States government; sometimes they don't. 

Coll said corporations do take on ethical responsibilities because "companies like Apple can't afford for the public to think that people are dying at their manufacturing plants."

But the oil business is different, he argued.  ExxonMobil isn't driven by a need to maintain a positive public image, Coll said, because the oil business isn't as reliant on consumer relationships. It is motivated more by a fear of the economic consequences of failure.

Coll began his talk by describing the crash of the Exxon Valdez, which he said, "in the public's mind was a type of drunk-driving accident."

In fact, he said, the incident was a "systematic failure" of ExxonMobil's safety and risk management record and its drive to cut costs, and also of regulatory oversight by the Coast Guard and the U.S. government.

"This failure signaled patterns that I thought were likely to repeat themselves, and in fact did repeat themselves."

The author of books investigating CIA operations in Afghanistan, the rise of the Bin Laden family and people working at the Security and Exchange Commission, Coll said reporting on a corporation was the most challenging work he has taken on.  "I really didn't know what I was getting into. This is a very closed company."

President of the New America Foundation, a non-partisan public policy think tank, Coll spoke at Duke as the DeWitt Wallace Center for Media and Democracy's annual Ewing Lecture on Ethics. 

Below: Steve Coll discusses the Exxon Valdez accident during his talk Tuesday at the Sanford School.  Photo by Megan Morr/Duke University Photography.

Steve Coll