Apache CEO, Vermont activist build alliance on climate issues

Thu Apr 17, 2014 9:43pm GMT
 

By Ross Kerber

NEW YORK, April 17 (Reuters) - Steve Farris runs a $33 billion Texas oil and gas company and turns, for advice, to a bearded Vermont environmentalist.

As other energy firms battled climate change and anti-pollution activists in recent years, the Apache Corp chief executive instead built an alliance with Steven Heim, managing director of Boston Common Asset Management, one of the better-known socially responsible investment firms.

The relationship helped Apache sidestep time-consuming proxy fights that have plagued some of its peers, in exchange for changes like committing to protect the rights of native peoples living near remote gas projects, and using cleaner chemicals in hydraulic fracturing, a drilling method that environmentalists say could threaten groundwater.

Heim also stages investor meetings for Apache where its executives and engineers take questions on topics like pollution or human rights. These draw representatives from mainstream investment firms like T. Rowe Price, Gabelli & Co and Morgan Stanley & Co.

"What I've been trying to do is to elevate the level of understanding of issues by the investors, not just the executives," Heim said.

Others have taken notice as climate change becomes more of a business concern. ConocoPhillips now also consults Heim, for instance, while Chevron Corp Chief Governance Officer Lydia Beebe said it has sent representatives to the Apache meetings and staged similar ones of its own.

"The 'Apache Model' is a very appropriate one for constructive shareholder/company engagement," Brian Rice, a portfolio manager for the California State Teachers' Retirement System, said in an e-mail.

Peace with environmentalists has helped take some pressure off Apache, whose share price has lagged rivals' on concerns like the security of some of its overseas projects, including a large investment in politically chaotic Egypt.   Continued...

Market Update

  • Africa
  • US
  • Europe
  • Asia
UK £ USD =1.5681
Euro USD =1.2428
Rand USD =0.0916