A Letter from our Chairman and CEO Regarding Climate Change
With this report, ConocoPhillips is consolidating our climate-related disclosures to provide improved accessibility and meet evolving reporting guidelines and rising stakeholder expectations. We have transparently reported on our efforts to reduce our greenhouse gas (GHG) emissions and manage climate-related risk since 2003, when we developed our Climate Change Position. This report further aligns our reporting to the recommendations of the Task Force on Climate-related Financial Disclosures to provide investors and the financial community with information to evaluate our performance and progress.
We have the governance structure in place to manage climate-related risks and opportunities throughout the organization, from strategic planning to operating decisions. Our board of directors plays an oversight role in climate-related strategic planning and enterprise risk management, with our Executive Leadership Team responsible for direct management and assisting our business units in planning and implementation. Climate-related risks are mapped to relevant enterprise risks, and our Climate Change Action Plan includes line-of-sight goals for business units and key functions.
Our current business strategy, including our asset portfolio mix and capital allocation approach, has been tested and showed resilience in a volatile and challenging marketplace. We have managed through a severe industry downturn, emerging with greater efficiency, enhanced technical capability and reduced cost of supply. We have also divested higher-emission-intensity assets such as oil sands and some older natural gas fields.
Consumer choices, government policies and technology advances will drive many possible pathways to a lower-carbon transition. We integrate climate-related risk scenarios into our strategic planning process to test our portfolio and we utilize annual GHG price forecasts for long-range planning and project evaluation. Consideration of these scenarios and monitoring of emerging issues provide the ability to manage risk, optimize opportunities and respond effectively to uncertainties. We believe that this capacity, along with our capital and portfolio flexibility and strong strategic planning process, equips us to manage long-term transitions in energy markets.
As we go about our primary mission of competitively delivering reliable, affordable and sustainable energy to meet demand, we aspire to be a leader in managing climate-related risk. We believe we have the governance structure, strategy, risk management processes and engagement approach that will enable us to achieve these goals and provide disclosure that transparently tracks our performance.
Ryan Lance Chairman and Chief Executive Officer