Organizational responses to climate change related stigmatization in multinational oil and gas industry

Abstract

The oil and gas industry stands out as one of the most prominent contributors to the climate change problem. In view of growing stakeholder scrutiny and tightening legislation, the sector confronts stigmatization due to the immense carbon footprint of conventional operations. Organizational responses of multinational firms to this profound illegitimacy status carry great importance to avoid the potentially catastrophic outcomes of global warming. Hence, this study strives to achieve a better understanding of the stigma reduction strategies that were developed and implemented by the leading oil and gas companies throughout the last decade. Accordingly, the research adopted a mixed methodology, and a content analysis was conducted for the voluntary disclosures of influential organizations. The findings of the assessment were interpreted in line with the theoretical framework of stigma management strategies. It was revealed that a combination of both symbolic and substantial methods was introduced by oil and gas businesses to cope with the intensifying societal disapproval. The results indicated that transformative approaches of category straddling and asset divestment were gaining popularity among examined firms in recent years. Companies recognized the advancements in renewable energy technologies and claimed the membership of this legitimate field through their investments in an increasing manner. The urgent need for a shift in fossil fuel sectors towards the low carbon sources to keep the atmospheric temperature under 2°C degrees above pre-industrial levels in line with the Paris Agreement goals makes such trends invaluable for the future of climate action. Furthermore, inferences of this research add to the literature on the classification of organizational responses to stigma.