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Speech

May 13, 2016

Vision and Cooperation in the Service of Shared Ideals

Rex W Tillerson

Rex W. Tillerson Chairman and Chief Executive Officer

Coast Guard Foundation
Houston, Texas

It is an honor to receive the 2016 Guardian Award from the distinguished leadership of the Coast Guard Foundation – and to celebrate with so many who deeply respect our service men and women, including our former governor, Rick Perry.

I consider it one of the great privileges of my position to accept this recognition on behalf of the men and women of the Exxon Mobil Corporation. It is a tribute to their focus, discipline, and hard work – day in and day out, year after year.

The Guardian Award is especially gratifying because of who is bestowing this award and because of what it represents.

Like the Foundation, we, at ExxonMobil, appreciate and support the men and women of the United States Coast Guard who are “always ready.”

We also share a commitment to the ideals embodied by this award, because we believe in doing our part to protect the “aesthetic, recreational, commercial and environmental qualities of our coasts, waterways, and oceans.”

For ExxonMobil, the results of all these efforts are the culmination of a long – and still on-going – journey. It has been a shared journey to create a culture of safety, one that is focused on effective risk management at every stage in the energy chain.

For more than 40 years, I have witnessed and personally walked this journey.

This evening I want to briefly discuss what ExxonMobil has learned on that journey … how we are applying proven principles of risk-management today … and how government and industry can continue to improve safety, operational performance, and environmental stewardship all across our nation.

Journey to a Comprehensive, Systemic Approach


ExxonMobil’s approach to safety and risk management begins with a clear and unequivocal statement: A vision of a workplace where “Nobody Gets Hurt.”

We believe safety must govern everything we do – from our planning and facility construction … to our drills and emergency responses … to the way we approach every business process on a daily basis.

One of the turning points for our entire company came with the Exxon Valdez oil spill.

It was a profound shock, one that caused all of us at Exxon to take a big step back, to examine how we were operating, and how we were managing risk.

Before that tragedy, safety was indeed a priority. But after that, ExxonMobil’s management undertook what I consider to be a visionary approach.

In the 1990s, we set out to wholly reorganize the company to put safety – of people, facilities, and the environment – at the center of everything we do.

Safety would no longer be viewed as a priority, but as a core value. Priorities can – and do – change with business circumstances. Values are a constant in all circumstances.

To implement this change, we developed a comprehensive system with standards designed to identify hazards and to manage safety, security, health, environmental, and process risks.

We called it the Operations Integrity Management System, or OIMS.

The standards, work practices, and regular-and-rigorous site assessments associated with OIMS are in place today across all ExxonMobil operations.

Through OIMS, we monitor, benchmark, and measure all aspects of our safety performance. And we are constantly reviewing and updating these standards as new data become available.

Our OIMS system is also designed to manage any process changes by fostering open and effective communication and by ensuring knowledge gaps do not exist.

But OIMS is just one part of the equation.

Even the best safety systems are not effective unless they are part of a broader culture of safety – the unwritten rules and norms that shape mindsets, attitudes, and behavior.

The Irreplaceable Role of Leadership


OIMS is inspired by the belief that leadership drives culture, and culture drives behavior.

Leaders influence culture by setting expectations, building structure, teaching others, and demonstrating stewardship. That is why the first element of OIMS is “management leadership and accountability.”

But managers alone cannot – and should not – be the only ones contributing to safety and effective risk management.

There must be a culture guiding and influencing decisions as well as behavior throughout the organization.

Therefore, responsibility for safety and effective risk management comes not just from supervisors and managers, but from our employees and contractors at every level.

Of course, as ExxonMobil has traveled on this safety journey over the years, we have learned that encouraging a culture of safety means working beyond the bounds of our corporation and reaching out to educate and protect contractors, business partners, and the communities where we are located.

On our journey, we have also learned that safety is too important to be considered proprietary. Industry leaders must continue to work together to share all that we know about safety, and develop as many ways as possible to share lifesaving information and techniques.

This is especially true in the wise and careful stewardship of our nation’s oceans, rivers, and waterways.

That is why ExxonMobil has been committed to working within our industry and with the government to share our best practices.

This vision for safety and effective risk management must also lead to concerted action. For, a major incident in any industry now affects the standing of all industries in the eyes of consumers, regulators, and the media.

Marine Well Containment System


Tragically, we were all reminded of this only six years ago.

At this time six years ago, the U.S. government and industry were working day and night in the Gulf of Mexico to respond to the tragic accident, loss of life, and spill from Macondo.

This event reinforced the critical lesson that incident prevention is always the first and best priority.

We were reminded that risk management must be at the center of every step in the exploration, production, and delivery of energy. We know that when you properly design wells for the range of risk anticipated … follow established procedures … build in layers of redundancy … properly inspect and maintain equipment … train operators … conduct tests and drills … and focus on safe operations and risk management, tragic incidents like the one that occurred in the Gulf of Mexico should not occur.

The incident in the Gulf quickly inspired cooperative action by the energy sector. It made clear that our industry needed to enhance the capabilities to rapidly contain a deepwater blow-out.

And we have done that.

Just months after the incident, ExxonMobil took the lead in an industry effort to develop and deploy the Marine Well Containment System. We continue to work with the system’s other sponsors: Chevron, ConocoPhillips, and Shell.

The $1.8 billion-dollar project has enabled us to more effectively and efficiently bring our combined expertise, equipment, and technologies to bear if a similar incident were to occur.

It has been a major investment – a contingency we believe we should never need, if our industry adheres to the stringent standards already in place.

The Marine Well Containment System is an example of what vision, cooperation, and concerted action can achieve.

We also know that it would not have been possible without the United States Coast Guard and its Marine Safety Resources. We received guidance from – and continue to work closely with – the Coast Guard’s Headquarters … the Marine Safety Center … and the Marine Inspection Units from Activities Europe as well as Corpus Christi.

On behalf of all the companies involved in the Marine Well Containment System and our entire industry, I offer my thanks to the United States Coast Guard.

Roles and Responsibilities in Risk Management


Both government and industry must play a role in safety, risk management, and environmental stewardship.

Understanding these specific responsibilities and each other’s respective strengths is one of the most important steps for achieving our shared ideals and aspirations.

As I have noted, industry’s first responsibility is to operate in a safe, secure, and responsible manner.

Government also has a role that only it can play.

For many years now, ExxonMobil and our subsidiary, SeaRiver Maritime, have worked with the Coast Guard to shape prudent maritime regulations.

We have also worked closely with the Coast Guard to enhance our preparedness with our North American Regional Response Team training drills.

Finally, we recognize another important function that can only be played by government: coordination during a time of crisis.

In such circumstances, the federal government working with state and local agencies must take the lead in marshalling resources and coordinating the response.

The government is also in the best position to coordinate the expertise and effort volunteered by private industry in such disasters.

The U.S. energy industry’s respect for this governmental role has been shown by how quickly and comprehensively we respond to government requests for input and assistance.

The waterways of commerce and trade have long been part of the story of energy.

Across all points along our nation’s vast shoreline, any time, any day, the men and women of the United States Coast Guard consistently demonstrate an unwavering commitment to protect the public, the environment, and security interests.

At ExxonMobil and SeaRiver Maritime, we are deeply thankful for this sacrifice and service. We look forward to continuing our work with the Coast Guard to fulfill our society’s shared aspirations for expanding energy supplies, increasing efficiency, and being wise and careful stewards of the environment.

Once again, I am honored to accept the Guardian Award on behalf of the men and women of ExxonMobil.

Thank you for your kind attention.

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