Fossil Fuel CEOs Bonus Pay Helps Sink the Climate, Report Says

A report released Wednesday examining the pay practices of the 30 largest publicly held U.S. oil, gas, and coal companies concluded that pay incentives for the companies' chief executives encourages reckless behavior and is hastening a climate crisis.

In the analysis all 13 oil exploration and production companies examined by the Institute for Policy Studies (IPS) tied executive bonuses to increasing the amount of proven carbon reserves each year.

"What we are essentially doing here is paying people massive amounts of money to continue to drill and burn and do things that are going to harm the planet and put a lot of costs on the rest of us," said lead author Sarah Anderson of IPS, a Washington D.C.-based think tank.

Fossil fuel companies current hold vast reserves of oil, gas, and coal which, if burned in their entirety would emit five times the amount of carbon than can be emitted to keep the planet from warming more than 2 degrees Celsius.  The same companies also spend $600 billion a year to locate additional carbon reserves.

"These companies are already sitting on reserves that if fully burned would cause catastrophic effects, so why are we tying executive bonuses to expanding those reserves?" Anderson said.

Compensation packages for corporate executives are increasingly tied to short-term profit gains, a practice financial watchdogs criticize.  For the oil and gas sector, however, the concern is amplified by the carbon dioxide emissions created from burning fossil fuels.

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