What's Wrong With Exxon?
BY Antonia Juhasz
September 03 2013 5:00 AM ET
For 22 years, the annual AIDS Walk has been the premier fundraising event of Fort Worth’s AIDS Outreach Center — the only nonprofit HIV/AIDS organization in the city. It supports seven surrounding rural counties and provides a full host of services — mostly free of charge. The majority of its clients are black or Hispanic and range in age from children under 12 to seniors over 64.
The AIDS Walk regularly brings in some $50,000 annually. For years, XTO Energy was among its many key local corporate sponsors. In both 2009 and 2010, XTO donated $10,000 to the march. But in 2011, XTO’s contributions abruptly stopped.
“It hurt us. It definitely hurt us,” says Penny Rowell, the Center’s special events coordinator. “It is a very, very large loss for us. A very large and very unexpected loss, too.”
What changed? “The Exxon Corporation bought XTO out,” Center Development Associate Randall Gentry explains. “We have tried since then to regain their support, but they will not support us at all whatsoever. Exxon is much more skeptical of writing a check to an AIDS organization.”
“The Death Star”: Exxon Mobil
Exxon Mobil’s world headquarters in Irving, a Dallas suburb, are hidden behind a locked, guarded steel gate and an impenetrable enclosure of fences. Towering trees permit only rare glimpses of the top of a looming black building. Some employees call it “The Death Star.”
When a group from Resource Center Dallas, the area’s leading LGBT advocacy organization, approached the building for a rare meeting 15 months ago, it felt as if they were entering a military fortress. “The Mission Impossible theme was rolling through our heads,” recounts Rafael McDonnell.
The most profitable corporation the world has ever known, Exxon is the quintessential Goliath to many a struggling David. In 2012, Exxon posted the second-highest annual corporate profit in history (surpassed only by its own 2008 record): $45 billion—more than the combined profits of Royal Dutch Shell and Wal-Mart Stores, the world’s No. 1 and 2 largest companies that year. If Exxon were a nation and its $450 billion in 2012 revenue its GDP, it would be the 27th largest economy on the planet. In many places, it is considered more powerful than the government. In 2001, President George W. Bush said of Exxon, “Nobody tells those guys what to do.”
Exxon stands out for other reasons, too. Over the past two decades, many of the giants of corporate America have been encouraged (and cajoled) to support and celebrate their LGBT employees and their families. Exxon has refused to join them.
In 2012, and again in 2013, the Human Rights Campaign gave Exxon Mobil a negative 25 out of 100 possible points on its annual Corporate Equality Index. It is the lowest score ever received by any corporation. No other company has ever received a negative score.
Instead, in 2013, the HRC found nearly 90% of Fortune 500 companies had adopted written nondiscrimination policies prohibiting harassment and discrimination based on sexual orientation, as had 94% of Fortune 100 companies. With the exception of Exxon, all of the Fortune 10 companies have adopted such policies, as have Exxon’s largest oil company competitors. Over 62% of Fortune 500 companies had domestic partner health benefits. Over 70% of the Fortune 100 prohibited discrimination based on gender identity or expression.
Exxon not only failed to meet a single one of these or the other HRC criteria for an LGBT-inclusive workplace, it has also actively worked for 15 years against annual shareholder resolutions calling for such inclusion.
But Exxon isn’t simply stuck in the early ’90s — it has actually erased nondiscriminatory and partner benefit policies in place in companies it has purchased: Mobil Oil Corporation, in 1999, and XTO Energy, in 2010. It is the only company known to have ever permanently done so.
Above: GetEqual activists Cd Kirven and Mark Reed-Walkup outside the entrance to ExxonMobil’s world headquarters in Irving, TX.
Exxon is under investigation by the state of Illinois for employment discrimination based on sexual orientation. A second case of such discrimination was found in Texas this year.
“It was a slap in the face,” says Tom Allen of the reversal of Mobil’s LGBT policies. “We worked so hard to get them, and this took us back 30 years.” Allen went to work at Mobil when he was 23 years old and stayed with the company through the Exxon merger until his retirement in 2010, after 35 years of service. He participated in Mobil’s historic implementation of LGBT nondiscrimination policies and partner benefits.
“I find myself embarrassed today that I have to defend where I work,” Allen says. “And the bigger slap in the face is that it just keeps going. Every single year at that [expletive] stockholders’ meeting, they slap us in the face again.”
As a result of Exxon’s policies, Allen’s former domestic partner and his current husband have both been denied medical and other benefits they would have received at Mobil.
A gay former employee of XTO Energy and Exxon who spoke on the condition of anonymity for fear of retribution, says of the change in policy, “I feel that [Exxon is like that] racist old aunt, that racist grandfather figure, that person completely out of touch with the times. I don’t see the upside to the company for continuing [the discriminatory policies]. Someone must think there’s an upside. I don’t know what it is…. So, now I’m like, ‘OK, how much longer are you going to be out of step with the rest of us?’”
Some version of this question was put to me again and again, by federal and state government officials, lawyers, shareholders, former employees, union representatives, activists from a variety of arenas taking on Exxon, human resources representatives from Fortune 500 companies, and many others: “Why won’t Exxon change?”
“Exxon is just such a rogue outfit,” says Congressman Alan Lowenthal of California, a cosponsor of the Employment Non-Discrimination Act and the sponsor of an amendment barring Exxon from winning future government oil and gas leases until it changes its LGBT policies. “You don’t have to be progressive just to join the rest of the human race and not discriminate. I don’t get it.”
There’s certainly no meat-and-potatoes business reason for Exxon’s refusal to budge — a fact that must be obvious to the board of directors, most of whom run companies of their own with perfect HRC ratings. But a variety of explanations suggest themselves: an innate social conservatism, arrogance, hubris, and the entitlement that comes with being one of the most powerful corporations on earth. The world runs on oil, and no one tells the king of oil what to do. No matter how damaging the king’s choices.
“The world has moved on and left Exxon behind,” says Diane Bratcher, former president of the Equality Project, who has spent some 20 years fighting to change Exxon’s LGBT policies. “We told them it had and we told them it would, and they don’t care.”
Gay at Exxon
1978-1998: Turning Tides at Mobil
Tom Allen was just 14 years old when he landed his dream job: church pianist. That was in 1969. After four years of joyful service, however, his pastor pulled him aside. He had been told that Allen was “a practicing homosexual.” If true, he would be expected to resign. “I was shocked,” Allen recalls. “So I lied.” He thought, “If I have to tell a little white lie to keep doing what God wants me to do, that’s worth the effort.”
But his heart was no longer in it. Shortly thereafter, Allen left both his position and the church. The lessons he learned that day would define much of his professional life; Allen remained essentially in the closet at work for the next 20 years.
In 1978, Allen was hired as a secretary at Mobil in Dallas. Being gay “became like a strategic game to me,” he explains, sitting in a café in the heart of Dallas’s Oak Lawn. “I know who I can tell, I know who I wouldn’t tell or shouldn’t tell or can’t tell…I kind of saw it as separate but equal, but at the same time, I didn’t let that bother me. As unfair and as weird as that seems today, that’s the way the world was.
By the early ’90s, Allen had a new, higher-ranking job as a human resources manager, and a new outlook. In the wake of the HIV/AIDS epidemic, “I began to think, OK, you know what? Life’s too f-ing short for this.”
He chose his moment; at the end of a sexual harassment seminar that had covered only heterosexual interactions, he raised his hand and said, “The whole world ain’t straight.” The lawyer running the seminar said the case law agreed with Allen; sexual harassment included same-sex offenses.
From that point on, things moved rapidly. Allen and other gay employees found each other “through gaydar.” Many were in HR, and during smoke breaks started asking colleagues pointed questions. “It was easy for us to get the message across: ‘Do you value me even if you know I’m gay?’”
By the mid-’90s, the Equal Employment Opportunity policy was changed to include sexual orientation. LGBT organizations were formed, and “we began to have more presence, and of course with that comes a lot more confidence.”
Mobil CEO Lou Noto flew a group of LGBT employees, including Allen, to the company’s headquarters in Fairfax, Va., to share their experiences. As they discussed being treated differently from their straight colleagues, including cases of discrimination, Allen recalls Noto asking his diversity aide, “Help me out here. What is ‘straight?’” But the meeting was a success. “I don’t think it was six months before we had domestic partner benefits.”
Then everything changed.
1999-2013: Falling Backward: from Mobil to Exxon Mobil
In 1999, Exxon merged with Mobil.
Allen and his colleagues looked at the merger with dread. “We were afraid of the Exxon culture,” he says. It’s an all-too-common refrain.
Above: ExxonMobil Chairman and CEO RexTillerson (in hat), past President of the Boy Scouts of America (2010-2012), being inducted into the BSA Eagle Scout Hall of Fame in 2009.
In Private Empire: ExxonMobil and American Power, author Steve Coll captures popular perceptions of Exxon, with the word “cultish” appearing often. Coll quotes other oil company executives describing their Exxon cousins as “ruthless, self-isolating, and inscrutable, but also as priggish Presbyterian deacons who proselytized the Sunday school creed [founder John D.] Rockefeller had lived by: ‘We don’t smoke; we don’t chew; we don’t hang with those who do.’ Ethics rooted in Judeo-Christian religious tradition were part of the fabric of Exxon.”
One executive who served on the board of directors told Coll that Exxon maintains “‘kind of a 1950s Southern religious culture. They’re all engineers, mostly white males, mostly from the South…They shared a belief in the One Right Answer, that you would solve the equation and that would be the answer, and it didn’t need to be debated.’”
Exxon scrapped Mobil’s sexual orientation nondiscrimination policy. People with domestic partner benefits at Mobil were grandfathered in, but such benefits would not be offered in the future, nor would they be offered to future partners. “We were shocked,” Allen recalls—but they did not feel empowered to make change.
Allen is adamant that in the 10 years he was at Exxon, he knew of no one being fired or demoted for being gay. But he also admits to a work life that, even for him as a manager, amounted to a very quiet “out.” Given that there is no legal basis at the company, most states, or the federal level to support claims of discrimination, it is highly plausible that such discrimination, if it did occur at Exxon, would go unseen by Allen and unreported.
The lack of equal benefits, however, is another matter.
Before the merger, Allen’s long-term partner, Scott, had his own health insurance. But after the merger, Scott was diagnosed with cancer, lost his job and insurance, and was confined to a wheelchair. Because he was not already on Allen’s insurance (and was not Allen’s wife), he could not be added.
In 2008, Hurricane Ike struck the Gulf Coast. Allen (who, with Scott, had moved to Houston) and a handful of other employees were called to Dallas, one of whom received permission for her husband to stay at a hotel at Exxon’s expense. Allen asked for equal treatment for Scott.
His boss said no, because, “You’re single. When it comes to fighting that battle inside this company, you choose your battles wisely. You go for the battles you can win. That’s not one of them.”
“I felt exploited,” Allen recalls. In two years, it was time to retire, and Allen was ready. Then, in August 2012, Allen fell in love again, with Jeff Howard. The two are married, although neither Texas nor Exxon recognizes the union. Howard suffered a heart attack a few years ago and the repercussions persist; he has no health insurance. With any Exxon retiree who divorces and remarries an opposite-sex partner, the new spouse is eligible for insurance. Not so for Allen and Howard.
As for Exxon, Allen does not regret the time he spent there, but he is pissed off and wishes senior management “would do us the courtesy of listening” and finally change its policies. And he wants to know “Why? Who or what is doing this? What’s causing this? Where is the roadblock?”
Falling Backward 2: from XTO Energy to Exxon
By the time Exxon acquired XTO in 2010, equal employement rights and benefits were increasinly taken for granted, and Houston had a lesbian mayor, Annise Parker. LGBT employees of XTO, like “Fred,” had every reason to feel hopeful that the changed climate would help ensure they would keep their existing protections. Instead, Exxon followed the same playbook it used in the Mobil merger.
“Fred,” a gay former XTO/Exxon employee, is baffled by the decision. “To my knowledge they’ve never articulated why they think it’s a good business practice, other than the blanket ‘we don’t impose anything on ourselves that we’re not required to’,” he says.
He believes the policy creates a chilling effect, keeping LGBT employees from speaking out within the company. It also applies to speaking with the press. Fred explains, “There is nothing written about Exxon that they are not aware of.” Every story is scrutinized and a written response prepared. If the story is big enough—such as when Exxon was sued for employment discrimination based on sexual orientation—talking points are circulated to all employees.
Exxon Mobil Sued for LGBT Discrimination
On May 22, 2013, Freedom to Work, a nonprofit advocacy organization working for the passage of ENDA, sued Exxon for engaging in employment discrimination on the basis of sexual orientation, constituting a civil rights violation and unlawful discrimination under the Illinois Human Rights Act.
Six months earlier, two young women, Jennifer Priston and Michelle Caland had submitted applications for the same administrative assistant position at Exxon in Patoka, Ill. Both women lived in Springfield, had graduated from the same local high school and community college at the same time, and were active in their local communities.
But Priston was clearly the better-qualified candidate. She had higher grade point averages in high school and college, more advanced computing skills, a broader range of relevant work experience, and previous jobs with greater responsibility and tasks that were more relevant to the duties at Exxon.
There were other differences as well. Caland identified as a feminist by noting her participation in the Feminist Activist Coalition; Priston identified as LGBT by noting her volunteer work at the Gay and Lesbian Victory Fund.
Though Caland was the weaker candidate, Exxon sought on multiple occasions to contact her to arrange an interview for the position. She never responded. Priston received nothing more than an automated email confirming receipt of her application.
The Illinois Department of Human Rights has opened an investigation into the case. “The facts as alleged would constitute a violation of the Illinois Human Rights Act,” says department spokesperson Mike Claffey. (The investigation is ongoing, but will head to court if sufficient evidence is found.)
Priston and Caland are not real people. Their fake résumés were developed by the Equal Rights Center, which has conducted decades’ worth of similar testing to uncover discrimination in housing, employment, and other areas. This is the first use of this method linked to litigation in an LGBT discrimination case.
The idea for the Exxon sting came from Tico Almeida, founder and president of Freedom to Work (featured in the Advocate 40 Under 40 list in 2012). Almeida, who had previously served as lead counsel on ENDA for the House Committee on Education and Labor, will drop the suit if Exxon implements LGBT policies and trains its managers. But if it fails to do so, he’s prepared to go to court.
“We have caught Exxon red-handed,” says Almeida. “We are sure a jury will decide there was no valid reason for Exxon to prefer the non-LGBT candidate. There is only one explanation, and that is discrimination.”
Freedom to Work’s investigation uncovered another instance of Exxon’s employment discrimination based on sexual orientation in Texas. But unlike Illinois, Texas has no law against such discrimination.
“Exxon Mobil Does Not Discriminate”
Exxon maintains that it does protect against discrimination and that no LGBT resolution is necessary to change its policies. The company declined multiple requests for interviews for this piece, but asserted—in an emailed statement—that its “global, zero-tolerance policy applies to all forms of discrimination, including discrimination based on sexual orientation and gender identity.”
This statement, however, is not, drawn from Exxon’s EEO policy and does not provide equivalent legal protection. Exxon’s EEO policy specifically enumerates every protected category, including age, race, sex, and religion, but does not include sexual orientation or gender identity.
“Having a nondiscrimination policy is very black-and-white,” says HRC Workplace Project Director Deena Fidas. “Exxon does not have one.”
Changing Exxon: Shareholder Resolutions
The effort to force Exxon to change goes back at least to 1997, when the Equality Project began pushing a shareholder resolution calling on Exxon to include sexual orientation in its EEO policy. The resolution was later expanded to include gender identity.
In spite of Exxon’s board’s annual instruction to shareholders to oppose the resolution, it has received the support of as much as 40% of shareholders at its peak in 2008.
The resolution first appeared on the ballot in 1999, sponsored by shareholder Marianne Weil. Her wife, the Equality Project’s Diane Bratcher, says Weil received anonymous letters threatening to “cut her up, calling her a dirty cunt, gross stuff,” in response.
From 2000 to 2009, the lead sponsor of the resolution was the New York City Employee Retirement System. From 2010 on it has been the New York State Common Retirement Fund, with its 14,103,456 Exxon shares valued at $1.3 billion.
New York Comptroller Thomas DiNapoli reports that his office has helped nearly 30 other large companies agree to new nondiscrimination policies. DiNapoli describes Exxon’s attitude toward the resolution as “dismissive” and finds its
Resource Center Dallas has successfully worked with numerous local colleges and universities, governmental agencies, and businesses to make their employment nondiscrimination policies more inclusive. Exxon seemed simply too immovable to be worth the Center’s already over-stretched time.
But in January 2012, Marilyn Carlson Nelson, a longtime Exxon board member (she has since stepped down), wrote an op-ed in the Minnesota Star Tribune supporting same-sex marriage.
The Center saw good reason to assume Nelson’s opinion was indicative of a board open to LGBT-inclusive policies. The majority of Exxon’s board members lead companies with Corporate Equality Index ratings of 100. In fact, every current board member who has served as a CEO or on the board of a company with an official CEI ranking has been at a company with a minimum rating of 90, most 100. The only exception is Exxon CEO Rex Tillerson.
Tillerson was former CEO Lee Raymond’s handpicked successor and is cut from the same cloth. Recruited straight out of the University of Texas at Austin, he has worked at Exxon his entire career and became CEO in 2006. He is regularly portrayed as seeking to remain faithful to Raymond’s policies, an attitude toward “the Exxon legacy” common among senior management.
Neva Goodwin, great-granddaughter of John D. Rockefeller, says, “All of the top executives are imbued with the Exxon culture and regard themselves as carriers of the culture.” She describes Tillerson as civil, “but [he] never responds in such a way that suggests that he could be at all influenced to change his positions.”
Tillerson is also a life-long member and past president of the Boy Scouts of America. His term expired a year before the group’s decision to allow gay troop members, but not leaders. His personal views on that matter and Exxon’s discriminatory policies are a well-kept secret.
Regardless of Tillerson’s personal views, it seems likely that the board, frequently described as turnkey for Exxon’s respective CEOs, is following orders from the company’s top executives when it recommends opposition to the shareholder resolution each year.
On April 4, 2012, Cece Cox, Resource Center Dallas director and CEO, wrote to Nelson, indicating her desire to meet with Exxon officials to share the Center’s expertise. Cox did not receive a response.
Cox then wrote to Malcolm Farrant, a newly installed vice president of Exxon HR, forwarding her letter simultaneously to the Dallas Voice, which published it the same day. Within hours, David Rosenthal, Exxon vice president of investor relations, contacted Cox.
Their meeting took place at the Irving headquarters in June 2012.
Cox was joined by Rafael McDonnell, Center communications and advocacy manager; Center volunteers Rebecca Solomon, a vice president at Bank of America, and Paul von Wupperfeld, a Texas Instruments manager; and Center board member Gary Fraundorfer, vice president of HR at AT&T. Though not representing their respective companies, they were able to offer expertise as employees of Fortune 500 companies either based in or with a substantial Texas presence that had successfully implemented LGBT-inclusive policies.
At the meeting, von Wupperfeld said that for Texas Instruments, a “traditional, conservative,” Dallas-Fort Worth-based company, it was “amazingly easy” to implement these policies. Moreover, “within our corporate culture there has been far greater lasting blowback from when we stopped giving away free donuts in the cafeteria.”
McDonnell shared a statement by the Family Research Council commending Exxon for “Resisting the Demands of Homosexual Activists” by rejecting the inclusion resolution. He asked, “Do you want these people speaking for your company?”
They felt that this was one of many “aha” moments for Exxon representatives, and left feeling optimistic.
Yet of their Exxon counterparts, Solomon says she “got a feeling that they exist on such a high level above everybody else that they just are not aware of what’s happening socially around them. They’re so large and so impenetrable, and I just don’t even think they care so much until someone actually asks the question in the room.”
Fifteen months later, Exxon has taken no actions and had no further contact with the Center, despite numerous letters and emails. It is a common experience recounted by many I interview: Exxon’s executives listen respectfully, then go about doing exactly what they’ve always done.
But there are many others in the fight. Cd “Chaz” Kirven and Mark Reed-Walkup, both well-known activists in their own right, are founding members of the nonviolent direct action protest group GetEqual. Since 2010, GetEqual Texas has led several protests against Exxon.
California’s Prop 8 led Reed-Walkup to activism. Kirven’s activism has many roots, including witnessing friends, transgender people, and butch women in particular losing jobs without any protection. For both Kirven and Reed-Walkup, their efforts are an extension of the African-American civil rights movement.
In January 2010, Kirven, Reed-Walkup, and fellow Texan Michael Robinson attended a national GetEqual retreat at the Highlander Center. Kirven saw iconic photographs there of black and white youths sitting together at the Woolworth lunch counter in the 1960s, being dragged to the ground and arrested because “Negroes can’t eat here,” which led her to conclude: “We need our lunch counter.”
“That’s what we have to do with employment discrimination,” she recalls thinking. “It needs a face, so that people don’t think of it in the generic form.” What better face than Dallas’s own Exxon Mobil?
Above: From left: Rafael McDonnell, Cece Cox, Paul von Wupperfeld, and Rebecca Solomon at the Resource Center Dallas. “We would drive ten miles in a blizzard out of gas to not go to an Exxon Mobil station pushing our car the whole way.” —Cece Cox
On February 14, they gathered a small group of local activists for the first of what would become weekly Sunday organizing meetings around Reed-Walkup’s kitchen counter. They called it their “extended church meetings,” because “you go to church to get inspired, and this was our version,” Reed-Walkup explains.
Since that meeting they have led protests at Exxon gas stations and outside the company’s annual shareholder meeting. The protests are modest in size, but draw plenty of attention. A 2010 photo of Kirven yelling into a bullhorn has become iconic, used by news outlets to accompany Exxon shareholder meeting stories every year hence.
Reed-Walkup believes Exxon remains incalcitrant because of a “culture of homophobia.”
Kirven refers to Exxon alternatively as a “bully,” “bigot,” and “just this big, sloppy monster” doing whatever it wants, spilling oil with one tentacle and discriminating with another simply because it has the money to do so. It is a story that resonates far beyond the LGBT community, she argues, and therefore focusing on Exxon helps tell the LGBT story to a broader audience.
“There is something universally accepted about calling out the bully on the playground,” she says.
Changing the Law
At the 2000 shareholder meeting, Lee Raymond, then-Exxon CEO, brushed aside discussion of the nondiscrimination resolution, telling advocates to “go pass a federal law instead.” This has been the position of the company ever since. In fact, in countries where Exxon operates and the law requires it to provide same-sex partner benefits, for example, it complies.
There are several options before the White House and Congress that could force Exxon to change, including implementation of the Supreme Court DOMA decision, a presidential executive order, and passage of ENDA.
New York Comptroller Thomas DiNapoli says that in light of the DOMA decision, states such as New York in which same-sex marriage is legal will likely require companies to adhere to its laws.
President Barack Obama indicated as a candidate in 2008 that he would sign an executive order banning federal contractors from discriminating on the basis of sexual orientation or gender identity. Exxon is a leading recipient of government contracts and would be heavily impacted by such an order. Even more impactful, of course, would be passage of ENDA.
But Exxon rarely sits by and waits for government action to affect it. More often than not, it is Exxon instead that changes government policy. Since 2008, Exxon has spent nearly $90 million lobbying the federal government and almost $6 million in federal campaign contributions. CEO Rex Tillerson has personally visited the White House a minimum of 13 times since 2009.
Exxon’s publicly available disclosure forms do not indicate that its lobbyists have addressed LGBT-related employment issues with the federal government. Tillerson, however, is not a registered lobbyist and does not have to disclose the contents of his meetings. In an email, White House spokesman Shin Inouye writes, “Regarding Mr. Tillerson’s visits to the White House, we routinely meet with a wide range of stakeholders, including business leaders, on a variety of issues.” The Advocate has filed a Freedom of Information Act request for the details of those visits.
Inouye adds that the president continues to support ENDA and says, “Regarding a hypothetical executive order on LGBT nondiscrimination for federal contractors, the White House has no updates on that issue.”
While those I have interviewed remain frustrated by Exxon’s recalcitrance, and most feel stung by the lack of leadership from the White House to change course, none are giving up.
“We have the facts on our side and the values of fairness on our side,” says Freedom to Work’s Tico Almeida. “I think we’re going to win. Every once in a while David beats Goliath.”
Antonia Juhasz is a Fellow of the Investigative Reporting Program, specializing in oil and energy. She is the author of several books on the oil industry, including Black Tide. She lives in San Francisco. On Twitter @AntoniaJuhasz