“Private Empire” is a big book about big oil, big money and big government. It chronicles how ExxonMobil — the energy behemoth that recently displaced Wal-Mart atop the Fortune 500 list, with more than $450 billion in revenue — operates in failed states, keeping the oil flowing when no one else can, and how it handles hapless bureaucrats charged with regulating it, scientists challenging it, rival companies trying to outsmart it and activists bent on changing it.

It is also a book about one idiosyncratic man — Lee “Iron Ass” Raymond — who was chief executive of the company from 1993 to 2005.

The global marketplace was remade during those years. The Soviet collapse had unleashed a wave of deregulations that opened markets to foreign investors. Asia, especially China and India, began a rapid ascent, fueling a global economy that posted unprecedented growth and booming stock markets. At the same time, the world gained heightened awareness about environmental damage caused by fossil fuels, while terrorism, war and all kinds of domestic political upheavals became common.

The impact on the corporate world was mixed. Most of these transformations boosted profits, but their speed and complexity created volatile conditions for business. And a company such as ExxonMobil is allergic to volatility.

“Exxon’s investments in a particular oil and gas field could be premised on a production life span of forty or more years,” writes Steve Coll. “During that time the United States might change its president and its foreign and energy policies at least half a dozen times.” Overseas it is even worse, with coups and revolutions and violence even more common.

“We see governments come and go,” Raymond once remarked, with considerable understatement.

So can a powerful corporation wield enough influence to evade and manage global volatility, and make it work on its behalf? In the case of ExxonMobil, it can, and with great success. “The corporation’s lobbyists bent and shaped American foreign policy,” writes Coll, “as well as economic, climate, chemical and environmental regulation.”

Getting the story of how it did so is the goal of this ambitious book. Coll, a two-time winner of the Pulitzer Prize, a former managing editor of The Washington Post and now a New Yorker staff writer, has a knack for prying open closed institutions. His book “Ghost Wars” chronicled the CIA’s involvement in Afghanistan pre-9/11, while his book “The Bin Ladens” painstakingly documented the saga of that family. In a recent interview with Texas Monthly magazine, Coll asserted that “reporting on Exxon was not only harder than reporting on the bin Ladens, it was harder than reporting on the CIA. . . . They have a culture of intimidation . . . they make people nervous, they make people afraid.”

Yet, ExxonMobil has met its match in Coll, an elegant writer and dogged reporter. More than 400 interviews, thousands of pages of previously classified documents obtained under the Freedom of Information Act, obscure court records and careful scouring of WikiLeaks documents provide the foundation of a fascinating story of how corporate power is exerted at the highest levels and across the globe. Coll traveled to Indonesia, Nigeria, Chad, Russia, Equatorial Guinea, among other places, as well as ExxonMobil’s headquarters in Irving, Tex., and, of course, Washington, the city where the company’s influence is as pervasive as it is effective.

While for most of its history Exxon was an international company — after all, large oil companies need to follow geology wherever it takes them — in the 1990s its global reach grew, and its ties to its home country became even more tenuous. While “Exxon benefited from the new markets and global commerce that American military hegemony now protected,” writes Coll, “Exxon’s far flung interests were at times distinct from Washington’s.” Raymond, the chief executive, “did not manage the corporation as a subordinate instrument of American foreign policy; his was a private empire.” Raymond put it even more bluntly: “I am not a U.S. company and I don’t make decisions based on what’s good for the U.S.”

The wholesale freeing of world markets that started in 1989 and boosted Exxon’s fortunes coincided with an accident that, in Coll’s view, helped the company by forcing internal changes that gave it an edge in the emerging competitive landscape: the Exxon Valdez oil spill. This environmental catastrophe, in which hundreds of thousands of barrels of crude spilled into Alaska’s Prince William Sound, was also a public-relations disaster, sinking the company’s reputation from the sixth most-admired in America to the 110th.

Raymond, then the company’s second-ranking executive, coordinated the response. As he learned the extent of the problem and the chaotic way in which his organization and the government agencies were dealing with it, he became “horrified and to an extent devastated.” Even his wife told him that “it’s the first time I have ever been embarrassed that we work for Exxon.”

Among the long-term changes Raymond introduced was “a financial audit and risk management system designed to identify and root out managers who cut corners, massaged revenue reporting or fiddled with expense accounts.” Raymond, who earned his “Iron Ass” nickname for his tendency to badger terrorized staffers, would fire people over the smallest expense irregularities. “Employees who found themselves on the receiving end of Raymond’s ridicule sometimes referred to him darkly as ‘the Lip,’ ” Coll writes, a reference to a childhood cleft palate.

Raymond’s reforms “would turn one of America’s oldest, most rigid corporations into an even harder, leaner place of rule books and fear-inspiring management techniques,” Coll explains.

The introspection and internal reforms triggered by the Valdez spill, plus the new markets in oil and gas that opened up around the world following the collapse of the Soviet Union, propelled the company to new heights, with revenue and profits multiplying to record levels. By 2005, the company’s profits reached $36.1 billion, more than any corporation had ever made before.

The company’s size, its profits, internal discipline and the critically important product it sold — energy — gave ExxonMobil inordinate power, which it used ruthlessly. “Compromise was not Exxon’s way” Coll states wryly.

That conclusion is borne out by Coll’s detailed examination of many instances where the company had to confront rivals, critics, governments or any group it felt could threaten it. A classic example was the company’s successful lobbying of the U.S. Congress to continually change obscure provisions in the tax code that would yield billions in savings. “A sardonic line among ExxonMobil lobbyists in the Washington office held that the corporation’s number-one issue of concern was taxation; its number two-issue was tax; its number-three issue was tax; and its number four-issue varied from year to year,” Coll writes.

The number-four issue that quickly became as important as taxes — and that did not change from year to year — was ExxonMobil’s crusade against efforts to lower carbon emissions. The company aggressively fought initiatives aimed at slowing the increase of global temperatures caused by the burning of fossil fuels. It did everything from funding congressional campaigns to supporting think-tanks, “climate coalitions” and so-called experts who would spread doubts about the science behind global-warming concerns.

It did not matter that these “experts” were often not climate scientists, Coll notes. “The books authored by members of this movement included titles such as ‘Red Hot Lies: How Global Warming Alarmists Use Threats, Fraud and Deception To Keep You Misinformed’ and ‘The Global Warming Deception: How a Secret Elite Plans to Bankrupt America and Steal Your Freedom.’ ”

At the 2000 annual meeting of ExxonMobil shareholders, an activist confronted Raymond and demanded a long-term solution to global warming. “If the data were compelling I would change my view,” Raymond responded. “Ninety percent of the people thought the world was flat. No?”

Raymond then asked an aide to show “the slide on the seventeen thousand scientists.” On a wide screen, a slide appeared showing a petition signed by thousands of supposed scientists casting doubt on the consensus on the issue. The problem, explains Coll, was that “the petition’s credibility had already been undermined by testimony presented to Congress demonstrating that its signatures included those of pop musicians such as the Spice Girls and James Brown. If Raymond knew about these problems, he did not care.”

ExxonMobil deployed all its resources and political prowess in the global warming battle and other environmental debates. “Whether the subject was the damage caused by oil and gasoline spills, climate change, the safety of chemicals . . . or other critical matters involving public health and the environment, the corporation joined directly in scientific controversies to protect its interests,” explains Coll. “It contracted with academic scientists, and it brought staff scientists out of ExxonMobil laboratories to lobby Congress and regulatory agencies. ExxonMobil’s science bore all the hallmarks of the corporation’s worldwide strategy: It was well funded, carried out by highly competent individuals, unrelenting in its focus on core business issues and influenced by the litigation strategies of aggressive lawyers.” The nagging question for those on the receiving end of these efforts, he writes, “was whether the corporation’s science could be judged honest.”

“Private Empire” also details ExxonMobil’s adventures in dealing with a guerrilla war in Indonesia; cozying up to Middle East oil sheikhs; arm-wrestling with strongmen such as Vladimir Putin, Hugo Chavez and Equatorial Guinea’s Teodoro Obiang Nguema Mbasago; its links with the Bush White House, including Raymond’s close friendship with vice president Dick Cheney; the 1999 merger between Exxon and Mobil; and its entry into the natural gas boom created by the widespread adoption of the controversial new technology called fracking. And much, much more.

Each instance is exhaustively researched and reported, highlighting Coll’s strenuous effort to provide evenhanded and fair reporting of ExxonMobil’s behavior. Yet his reporter’s instincts to stick to the facts and let readers interpret their meaning is one weakness of this otherwise extraordinary book. After almost 700 pages, we still don’t know what Coll explicitly thinks about corporate power and its political influence or what ideas he has about curbing the excesses that he so lucidly reports. His monumental undertaking surely left him with precious lessons and insights, but readers will have to distill them without the author’s help.

In the Texas Monthly interview, Coll offers one of his most revealing personal opinions: “ExxonMobil does follow the law, I think,” he said. “I’m persuaded that they really stay inside the lines.”

Of course, it is easy for a company to stay inside the lines when, as this book shows, it is drawing them itself.


Moisés Naím , a senior associate at the Carnegie Endowment for International Peace, is a former minister of trade and industry of Venezuela. He is a syndicated columnist and chief foreign affairs columnist for Spain’s El Pais and Italy’s La Repubblica.


ExxonMobil and American Power

By Steve Coll

Penguin Press. 685 pp. $36