California Resources Corporation (CRC) — ESG & Values Scores

Environment story

CRC is a fossil fuel E&P company with significant operational carbon exposure. The company adopted a 'Responsible Net Zero' goal in May 2025 targeting 80% Scope 1&2 reduction by 2045, but this relies heavily on carbon offsets rather than direct operational decarbonization. Scope 3 emissions (product combustion) are rising as production increases (138 MBoe/d in 2025 vs. 110 MBoe/d in 2024). The company operates steamflood and waterflood operations with high thermal intensity. Recent CCS permitting progress (EPA Class VI permit for 26R reservoir at Elk Hills) and commissioning of CO2 capture equipment show nascent low-carbon initiatives, but these serve industrial client capture rather than CRC's own material Scope 1 reduction. The 2045 net-zero target is 10 years later than the 2035 threshold in the rubric, triggering a 15-point deduction. Greenwashing risk: neutralization language relies on offsets and contractual instruments rather than direct operational cuts. No material water/toxic-waste controversies disclosed.

Criticisms on file

Kern County EIR Litigation (2022-2026): Environmental activists sued Kern County's ordinance permitting oil/gas wells, challenging CEQA compliance. Litigation halted new permitting until SB 237 enactment in Sept 2025. Trial court lifted stay on Feb 2, 2026.
Source: CRC 10-K Item 1A Risk Factors, Regulation of E&P Activities – Kern County EIR Litigation section
Closure of Major California Refineries: Phillips 66 Wilmington refinery closed Oct 2025; Valero Benicia refinery to cease operations by April 2026. San Pablo Bay Pipeline suspended Dec 2025, eliminating Bay Area market access. CRC expects higher transportation costs and reliance on southbound capacity.
Source: CRC 10-K Principal Customers section and Marketing Arrangements
CalGEM Well Stimulation Prohibition: CalGEM published rulemaking (effective 2024) prohibiting well stimulation treatment in oil production. CRC and other plaintiffs seeking declaratory relief; litigation pending.
Source: CRC 10-K Regulatory Activity section
Scope 3 Emissions Rising: Production increased 25% YoY (110 to 138 MBoe/d) and oil production rose 36% (80 to 109 MBbl/d), driving absolute Scope 3 emissions from customer combustion upward.
Source: CRC 10-K Production, Price and Cost History table and Berry Merger disclosures

Disclosed initiatives

Responsible Net Zero Goal (2045)

80% absolute Scope 1&2 reduction; neutralize remaining 20% via offsets and contractual instruments. Near-term: 20% carbon-intensity reduction in oil/gas production by 2035.

2045 target is 10 years beyond rubric threshold; heavy offset reliance signals greenwashing risk.
Elk Hills CCS Capture Project

CO2 capture equipment at cryogenic gas plant commissioned for injection into 26R storage reservoir (Carbon TerraVault JV) in spring 2026. Operational efficiency and propane recovery improvements expected.

Improves cogeneration plant efficiency but does not materially reduce Scope 1 direct emissions from oil/gas operations; primarily serves industrial third-party CO2 capture.
Carbon TerraVault JV (51% ownership with Brookfield)

CCS joint venture with EPA Class VI permits for 26R reservoir storage. Brookfield contributed $92M to date; additional contributions upon contracted injection volumes. Permits submitted for 7+ sequestration projects (Sacramento, Belridge, Central California).

Positions company as CCS operator but does not reduce CRC's own Scope 1 emissions; revenue model unknown.
TRIR and Spill Performance Targets

TRIR 0.40 in 2025 (excluding Berry); 1,124 gross barrels production fluids spilled. Safety metrics tied to employee incentive compensation.

Demonstrates safety commitment but not direct decarbonization.

Social story

CRC employs approximately 2,500 employees as of Dec 31, 2025 (up ~990 from Berry Merger Dec 18, 2025). Approximately 250 employees covered by collective bargaining agreement (10% unionization). No disclosed union-suppression activities or major strikes in last 24 months. Leadership diversity and CEO-to-median-worker pay ratio not disclosed in 10-K; lack of transparency on both metrics prevents full scoring. Company emphasizes safety culture (Stop Work Authority, annual TRIR/spill targets tied to incentive compensation), annual employee engagement surveys, and development opportunities. C&J Well Services (640 employees acquired via Berry) integration ongoing; Feb 2026 reduction in force announced (~$22M severance charge expected). No material human-rights controversies in supply chain disclosed. Engagement and retention initiatives documented.

Criticisms on file

No disclosed CEO-to-median-worker pay ratio or executive/board diversity percentages. 10-K Item 10 (Directors and Officers) and Item 11 (Executive Compensation) referenced but detailed tables not provided in source documents.
Source: CRC 10-K Parts III Item 10 & 11 - documents note sections exist but specific data not transcribed in source materials
Unionized workforce (~250 employees, ~10% of 2,500 total) but no disclosure of labor relations, neutrality agreements, or cooperative frameworks with unions.
Source: CRC 10-K Human Capital Management section

Disclosed initiatives

Employee Development & Training

Mandatory annual training on health/safety, business ethics, harassment, IT security. Performance reviews and career development discussions managed by direct managers. Leadership growth and career opportunity enhancement programs in place.

Standard HR practice; no quantified impact disclosed.
Culture & Engagement

Open and welcoming workplace culture goal; annual employee engagement surveys; senior management townhalls with Q&A. Engagement results reviewed by senior management and Board.

Engagement-driven retention efforts; no turnover rate disclosed for evaluation.
Safety & Environmental Stewardship

TRIR (0.40 in 2025, excluding Berry); Stop Work Authority for all employees/contractors/vendors; safety metrics tied to incentive compensation for all employees.

Exemplary recent safety performance; demonstrates strong HSE culture.
Post-Merger Integration (Berry & C&J Well Services)

February 2026 reduction in force; approximately $22M severance charge. C&J Well Services (640 employees) undergoing integration and restructuring.

Workforce restructuring may signal integration efficiency but creates short-term employee dislocation.

Governance story

CRC operates with a single share class structure (no dual-class voting disclosed). Board independence percentage and composition not detailed in 10-K excerpts provided. Company engaged in active lobbying to support SB 237 (oil/gas permitting facilitation) and operates within California regulatory framework with material political engagement. No disclosed consent decrees, major antitrust proceedings, or financial-fraud SEC actions in current filings. Board adopted Responsible Net Zero in May 2025, indicating governance-level ESG commitment. Berry Merger (all-stock, closed Dec 18, 2025) executed by Board; Aera Merger anticipated (detailed agreement Feb 7, 2024, status in 2025 unclear from excerpts). No evidence of shareholder litigation blocking climate proposals. Lobbying spend not quantified in 10-K. Management compensation tied to safety and environmental targets (TRIR, spill metrics). Overall governance structure appears standard for large E&P; regulatory complexity and permitting risk management are central.

Criticisms on file

Active Lobbying for SB 237 (Oil & Gas Permitting): Company supported enactment of Senate Bill 237 (Sept 2025), which deems Kern County SSEIR sufficient for CEQA compliance and permits up to 2,000 new wells/year for 10 years. Company statement: 'adoption of SB 237 will support operational continuity and investment planning' and 'enhance long-term development opportunities in Kern County.'
Source: CRC 10-K Regulation of E&P Activities – Senate Bill 237 section and Business Strategy
Regulatory Uncertainty & CalGEM Authority Expansion: California Legislature/Governor significantly expanded CalGEM jurisdiction and enforcement authority (public health, GHG emissions reduction, state energy needs). CalGEM published well-stimulation prohibition (effective 2024); CRC and others litigating validity. Scope and limits of expanded authority remain subject to legal challenge.
Source: CRC 10-K Regulatory Activity section
No Board Independence Percentage Disclosed: 10-K Item 10 and Item 13 (Director Independence) sections referenced but specific board composition and independence metrics not provided in source documents.
Source: CRC 10-K Part III Item 10 (Directors, Executive Officers, Corporate Governance) and Item 13 (Certain Relationships and Related Transactions and Director Independence) – data not transcribed in source

Disclosed initiatives

Board Adoption of Responsible Net Zero (May 2025)

Board formally adopted 2045 net-zero emissions goal with 80% Scope 1&2 reduction target and 20% production carbon-intensity reduction by 2035. Goal governance and methodology documented.

Governance-level ESG commitment; provides strategic alignment for carbon management business development.
Oil and Gas Reserves Review Committee

Standing committee of senior corporate officers reviews and approves annual reserves estimates; reports findings to Audit Committee. Director of Reserves oversees compliance with SEC rules (holds B.S. Petroleum Engineering, Colorado School of Mines, 16+ years E&P experience).

Established governance process for reserves validation and SEC compliance.
Management Compensation Metrics (Safety & Environmental)

TRIR and gross barrels spilled (e.g., 1,124 bbls in 2025, excluding Berry) integrated into incentive compensation for all employees. Quantitative performance targets annually established.

Aligns executive and employee incentives with HSE outcomes; demonstrates governance integration of ESG metrics.
Independent Reserves Audits

Netherland, Sewell & Associates (NSAI) audited 81% of proved reserves (California); DeGolyer and MacNaughton audited 5% (Uinta). Both issued unqualified audit opinions. Aggregate difference vs. CRC estimates <10% (within SPE tolerance).

Third-party reserves validation ensures governance quality and investor transparency.

These are Missionomics' own editorial scores — directional signals built from disclosed facts under a published method, not certifications or definitive ratings of California Resources Corporation. Coverage and confidence vary by data point, and figures can lag real-world changes. Read the full Methodology for sourcing, scoring, and correction details — or open California Resources Corporation in the app for interactive charts and portfolio building.

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