Transocean Board Member Env Expertise
|Filer||New York State Comptroller|
|Sector||Oil and Gas|
|Resolved Clause Summary||Add independent board member with environmental expertise|
Environmental expertise is critical to the success of companies in the energy industry due to the significant environmental issues associated with their operations. Shareholders, lenders, host country governments and regulators, and affected communities are focused on these impacts. A company’s inability to demonstrate that its environmental policies and practices are in line with internationally accepted standards can lead to difficulties in raising new capital and obtaining the necessary licences from regulators.
In January 2013, Transocean Ltd., the world’s largest off-shore oil drilling contractor, pled guilty to criminal violations of the U.S. Clean Water Act, and agreed to pay the U.S. government $1.4 billion in civil and criminal fines and penalties arising from the 2010 Deepwater Horizon rig explosion and oil spill in the Gulf of Mexico.
It is clear that corporate actions that create of serious damage to the environment can significantly damage shareholder value .Companies must respond to environmental challenges in an effective, strategic and transparent manner in order to create minimize the adverse impact of their operations.
Transocean would benefit by addressing the environmental impact of its business at the most strategic level by appointing a specialist to the board. An authoritative figure with acknowledged environmental expertise and standing could perform a valuable service to the company by enabling Transocean to more effectively address the environmental issues inherent in its business. It would also help ensure that the highest levels of attention focus on the development of environmental standards for new projects. Such a board role would strengthen the company’s ability to demonstrate the seriousness with which it addresses environmental issues.
THEREFORE, BE IT RESOLVED: Shareholders request that, as elected board directors’ terms of office expire, at least one candidate is recommended who:
- has a high level of expertise and experience in environmental matters relevant to hydrocarbon exploration and production and is widely recognized in the business and environmental communities as an authority in such field, as reasonably determined by the company’s board, and
- will qualify, subject to exceptions in extraordinary circumstances explicitly specified by the board, as an independent director.*
*For these purposes, a director shall not be considered “independent” if, during the last three years, he or she –
- • was, or is affiliated with a company that was an advisor or consultant to the Company;
- • was employed by or had a personal service contract(s) with the Company or its senior management;
- • was affiliated with a company or non-profit entity that received the greater of $2 million or 2% of its gross annual revenues from the Company;
- • had a business relationship with the Company worth at least $100,000 annually;
- • has been employed by a public company at which an executive officer of the Company serves as a director;
- • had a relationship of the sorts described herein with any affiliate of the Company; and
- • was a spouse, parent, child, sibling or in-law of any person described above.