ESG (Environmental, Social, and Governance) in Oil and Gas - Thematic Research

Climate change measures will fundamentally alter the industry

The measures the Paris Agreement signee governments will take to discourage emissions and ensure the success of net-zero goals will render conventional oil and gas activity less and less viable.
In the next decade, wherein hydrocarbon demand will not fall significantly, oil and gas companies should minimize losses to emissions-discouraging measures such as carbon pricing by altering processes across the value chain to reduce emissions.

In subsequent decades hydrocarbon demand will fall. Technological innovation and increased consumer mindfulness will make sustainable alternatives to hydrocarbon-intensive products more and more attractive. For example, in transport, historically the largest hydrocarbon-demanding sector, conventional cars will be displaced almost entirely by electric vehicles (EVs). Though some demand will remain, survival for most current oil and gas companies will mean transitioning to a new product. There are many options for products (renewable energy will be the most popular), but success in any requires that companies invest soon so that cashflows are already strong by the time demand falls. Companies that wait until hydrocarbon revenues dry up will have insufficient cash to fund a transition.

Strong governance and social practices are vital for the transition

Oil and gas companies will need effective governance to steer themselves through the existential disruption that the next three or four decades will bring. The balancing act necessary for companies to meet net-zero objectives while retaining scale demands deft leadership: companies must sustain sufficient cashflows to handle demand volatility, overhaul their asset portfolios, make astute investments, and satisfy sustainability-minded stakeholders, all while providing stable dividends.

As millennials come to dominate the consumer base and workforce and begin to assert their preferences, companies that fail to maintain good social practices (toward workers and affected local communities) will struggle to attract and retain customers and employees.

Scope

• Comprehensive ESG framework. Identification of contributing factors for each of environmental, social, and governance and mitigating actions companies can take against them.
• Explanation of the publisher’s ESG feedback loop and the opportunity for companies to establish a virtuous cycle of sustainable action that benefits all stakeholders and finances.
• Listing of all technological and macroeconomic trends relevant to ESG in oil and gas with explanation of their ramifications.
• Extensive coverage of the threats and opportunities that ESG concerns present to the oil and gas industry.
• Coverage and analysis of all relevant companies’ relative positions in the ESG theme: 11 oil and gas operators, 9 equipment and services providers.
• Unique thematic scorecard that ranks oil & gas companies according to their positioning in the ten themes most important to the industry.

Reasons to Buy

• Survive future demand drops and inhospitable regulation by understanding the threats and opportunities ESG concerns present to the industry.Position yourself for future success by making the correct ESG investments.
• Cut through the noise with the publisher’s ESG framework that identifies contributing factors and mitigating actions.
• Uncover the oil and gas companies excelling with the publisher’s thematic scorecard. Understand and replicate their success with the extensive coverage of each leading company’s activity in the companies section.
• Develop relevant and credible sales and marketing messages for oil and gas companies by understanding key industry challenges and which ESG products and services are desired. Identify attractive investment targets by understanding which companies are most advanced in themes that will determine future success in the oil and gas industry.