Corporations’ Influences on United States Government Climate Policies: Lobbying and Political
Action Committees
Annie Lack
PS 101: Introduction to American Government and Politics
30 Nov 2022
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Introduction
In contemporary times, lobbying has become a natural practice by many, especially
corporations with the power to influence public officials of high rankings. Notably, the climate
crisis has become a topic of grave importance. Although there are many companies devoted to
being a positive influence on climate policy in the United States, there are even more companies
loyal to continuing their traditional, harmful practices on the environment by influencing climate
policy within government legislation. Climate change has grown to become one of the most
controversial issues in contemporary society and large U.S. businesses and corporations are
major contributors to global warming, responsible for some of the biggest increases in
greenhouse gas emissions. The government sets regulations on businesses designed to aid the
climate crisis, however corporations spend hundreds of millions of dollars to delay these
regulations through support of leadership in trade associations, political nonprofits, even highly
targeted and widespread social media influence. Business’ values and positions on climate
change directly impacts the health of the environment because of their extensive influence on
climate policies in the U.S.. Lobbyists continue to mitigate policies or regulations that diminish
the burning of fossil fuels, pushing the climate crisis to dangerous extremes. Lobbying can be
direct in Congress, indirect to reach the public, or even through political action committees
(PACs) which work to influence policies in a similar manner.
Literature Review
How do United States’ corporations, or multinational corporations that operate within the
U.S., lobby legislation regarding climate policy? Money yields immense power, begging the
question whether money supplied indirectly through firms truly has an impact on how policies
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are created. Lobbying can come in many shapes and forms, although it is widely defined by the
National Conference of State Legislatures (NCSL) as, “…an attempt to influence government
action through either written or oral communication” (Scanlon 2021). Lobbying of legislature is
used by lobbyists that represent a common ideology amongst a population, whether that be an
interest group or other contributors, to achieve a common goal within Congress. The question of
lobbying through monetary values is better stated in “American Government 3e” suggesting,
“This has caused many to wonder whether the amount of money in politics has truly become a
corrupting influence” (Krutz et al. 2021, 383). Lobbying can be broadly distributed into two
categories: inside lobbying and outside lobbying. Inside lobbying consists of interest groups’
messages travelling directly to a policymaker. In contrast, outside lobbying uses lobbying tactics
to deliver interest groups’ messages to the general public (Krutz et al. 2021, chap.10). As the
climate crisis becomes more dangerous with every year that passes, both outside lobbying and
inside lobbying tactics are used on behalf of corporations—some in pursuit of avoiding the crisis,
others in hopes of aiding it. In an article titled “Lobbying Threat to Global Climate Action”,
Benjamin Franta—a historian at Stanford University—states, “Every time there's a climate
policy being proposed—which basically entails control of fossil fuels — the industry is there
mobilizing against it…Sometimes it defeats it entirely. Sometimes it merely weakens it”
(Glasgow 2021). With further analysis of Franta’s statement, along with review of other articles
in agreement, it is evident that corporations in contemporary times look to delay climate policies
through lobbying tactics in order to maintain company productions. Further, in the same article,
it was established that after the Paris Agreement, an international treaty on climate change, five
of the largest oil and gas companies, including American multinational corporation Exxon
Mobil, jointly contributed more than $1 billion in investment funding into “misleading climate
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branding and lobbying” (Glasgow 2021). Exxon Mobil has consistently stated their company
values in favor of climate change, yet their actions express otherwise. Some may be familiar with
the Kyoto Protocol, mentioned by the United Nations Framework Convention on Climate
Change (UNFCCC 2022) as an international treaty dedicated to holding states accountable for
reducing their greenhouse gas emissions, and while the Kyoto Protocol did not enter into effect
until February of 2005, Exxon Mobil holds a record of calling it “unrealistic” and “economically
damaging” (Ages 2015). The Political Economy Research Institute named Exxon Mobil the 10th
largest greenhouse gas contributor, totaling 0.6% of all 2019 United States greenhouse gas
emissions (PERI 2019). Withal, Exxon Mobil certainly isn’t the first corporation to do this, and it
is no wonder why corporations such as Exxon Mobil lean on lobbying tactics, as climate policies
drafted to cap greenhouse gas emissions would result in detrimental losses to companies such as
them. In the journal article titled, “Determinants and Effects of Corporate Lobbying” the authors
write, “We also find evidence that firms allocate significantly greater resources to lobbying
activities relative to (highly regulated) PAC contributions…for the average firm in our sample,
conditional on lobbying, expenditures are $1.01 million…corporate PAC contributions are on the
order of $0.120 million…” (Hill, Kelly, Lockhart, and Van Ness 2013, 932). This article is in
agreement with previously analyzed studies, as it goes hand-in-hand with the philosophy that
modern corporations seek to delay policies through lobbying measures. It can be concluded that
these lobbying measures are the result of a defense for forthcoming, perhaps unknown climate
policy regulations proposed to aid the climate crisis, although major corporations see it as an
attack on profits.
Another Means of Lobbying Climate Policy: Political Action Committees
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It is commonly known in the political climate that firms are not permitted to donate
directly to political campaigns, however, Political Action Committees (PACs) exist to act as a
buffer between direct contributions from corporations or additional donors and candidates.
Further, in the journal article previously established, titled, “Determinants and Effects of
Corporate Lobbying”, the authors mention a study conducted in 2010 by Cooper, Gulen, and
Ovtchinnikov, in which they found that contributions directly made to political action
committees by United States corporations held a positive correlation to the business’ future
earnings and profits (Hill, Kelly, Lockhart, and Van Ness 2013, 931). The findings through this
study are closely related to a study done by Bloomberg Green, in which donations by the S&P
100—designed to measure the performance of large corporations within the U.S.—and
additional contributing corporations to climate change were closely observed. From the
beginning, it was noted by the authors that some major corporations claiming drastic company
changes in favor of supporting positive climate policies were taking opposite actions. For
example, Exxon Mobil, a renown natural gas company has contributed $960,000 to political
action committees supporting select candidates, however around 60% of those funds were
allocated to candidates and policymakers who have been labeled as climate obstructionists
(Bradham, Tartar, and Warren 2020), despite Exxon Mobil’s sustainability statement printed on
their website, “We are committed to providing affordable energy to support human progress
while advancing effective solutions to address climate change” (2021; thereafter EM). It is
evident that their actions in pursuit of future profits, are in line with the study conducted by Hill,
Kelly, Lockhart, and Van Ness in which they assess that business’ donations to PACs are
reflected in their earnings. Although PAC contributions differ from lobbying practices, PAC
contributions reflect corporations’ company values, publicly showcasing a given firm’s support
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for a cause, in this case that being in favor of, or opposing climate policies. Even Further, the
money supplied from major firms who seek to delay climate policy advancements are greatly
influential because they support candidates responsible for drafting climate legislation.
Additional Considerations
Although some corporations and companies choose to lobby against policies directed at
preserving the environment and saving it from further destruction, others have taken the extra
steps to make a positive impact, lobbying for stricter climate policies or adjusting their practices
to be more climate friendly. In fact, an article published in the Harvard Business Review,
“Corporate Action on Climate Change Has to Include Lobbying”, the author mentions an
announcement on behalf of eleven corporations that hold “significant influence on the world’s
largest companies and on policymakers” that involves them advocating, more so calling
companies to action, to be more consistent with “science-based climate policy agenda”, or what
studies have suggested companies pursue in hopes of preserving the future of the environment
(Winston 2019). It is often assumed that a vast majority of companies naturally lean towards
avoiding practices that would be better for the environment and, in turn, more expensive or
costly in production. In retrospect, those believing this often overlook the companies that do
work to follow climate-policies in their production measures. This assumption is even further
backed by a study analyzed in the journal article, “Corporate Lobbying and Multilateral
Environmental Agreements: Examples From the Climate Change and Biosecurity Sectors”, in
which the authors explain that failure in legislation is easily attributed to powers of global
companies influencing policy behind closed doors. However, the true influence these
multinational companies pose on policies is more often assumed than observed or documented
(Orsini and Kleppinger 2011, 48). It is generally presumed by the public that corporations lobby
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in order to maintain net profits, yet this may be the truth for only a certain amount of firms.
Companies like Patagonia, who’s original owner transferred ownership to a nonprofit on terms
that the profits earned will go to fight climate change, must be acknowledged as those trying to
help the climate crisis.
Looking Ahead
There is no end in near sight for lobbying of government policies. As climate change
becomes an increasingly more controversial issue within United States legislation, it seems firms
will continue to lobby climate policies, weakening or delaying them, in order to maintain profits
or production costs. While some studies have concluded that climate lobbying is sometimes
assumed than empirically observed, there is sufficient findings that establish just the opposite. It
can be anticipated that the future of corporations’ lobbying on climate policies holds a positive
outlook, as money continues to be a driving force in the political climate of the United States.
Political action committees serve as an influence on government climate policy on behalf of
corporations’ contributions and the positive relationship between firms’ PAC contributions and
future profits should theoretically serve as an incentive for corporations to continue to use
lobbying tactics. In an article published on Bloomberg, titled “U.S. Companies Say Climate
Change is a Problem—But Still Lobby Against Solutions”, it was recorded that, “…more than
80% of the largest U.S. companies have set emissions reduction goals, less than half engaged
with lawmakers to advocate for science-based climate policies—and more than 20% lobbied
against them…” (Tobin 2021). While it’s been given that a majority of companies have
“declared” to lower their carbon footprints, few truly follow through backing their words with
actions in legislature, and it can be presumed that these ways will continue in the future.
Conclusion
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Taking all into account, negative corporate lobbying of climate policy in U.S. legislature
is detrimental to efforts designed to reduce greenhouse gas emissions and slow global warming.
Big name gas and oil companies are some of the largest contributors to greenhouse gas
emissions, and respectively, some of the largest contributors to political action committees aimed
at delaying climate policy regulations. Although these multinational corporations claim to the
United States population that they are making efforts to reduce their carbon footprint, their
actions in the political climate represent an entirely different motive. Firms aimed at delaying
legislation regarding climate change must be held accountable if environmental policies are to
ever be enacted in pursuit of a healthier future for the world.
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