ArnoldWatch Masthead
Home | Subscribe | Donate | Get Involved | Contact Us    

Energy Policy
Corporate Accountability
Political Reform

Get Involved

How Much From Special Interests?

The Foundation For Taxpayer and Consumer Rights


News Archive - Web Logs - Press Releases

Aug 20, 2007 - 01:00 AM

Clueless Mary Nichols

by Judy Dugan
When Arnold Schwarzenegger appointed former California Air Resources Board director Mary Nichols last month to head the same agency in his administration, reaction in the enviro world was mostly relief, tinged with worry: Could she stand up strongly to the governor and enforce the state's new global warming emissions law? But now we find that the influences on Nichols are closer to home. She has extensive stock holdings in Big Oil, and a husband who represents Exxon in the Exxon Valdez oil spill litigation.

To recap, Nichols was appointed after Schwarzenegger fired the board's strongly committed president, Robert Sawyer, and its executive director quit under administration meddling to weaken air quality rules. A legislative hearing had hinted the governor was consulting with Big Oil about how to slow down enforcement of the state's greenhouse gas law.

Now we find that Nichols apparently took the job with no intention of shedding her oil investments, possibly millions of dollars' worth. From the AP story:

"Nichols' holdings include shares in Chevron, Royal Dutch Shell, BP PLC, a Bermuda shipping company that transports crude oil and the world's largest coal company, Peabody Energy Corp.

"Five of the investments, including the Chevron stock, are worth as much as $1 million, according to a financial disclosure report Nichols filed recently with the state Fair Political Practices Commission."

Nichols, after the AP story, and after presiding over hearings on diesel emission rules despite this blatant conflict, is reluctantly saying she'll put her oil stocks in a trust. She'll still own them, though.

Nichols can't put her husband, John Daum, in a trust. But given that he works for the giant L.A.-based O'Melveny and Myers firm, he could recuse himself from oil cases with little or no effect on his professional situation, and possibly save O'Melveny from a black eye down the road.

Sen. Dianne Feinstein has taken harsh criticism for her husband's business ties with China and at least social ties with Chevron's CEO. Nichols' situation is much more compromised.

Here, for reference, are the relevant citations of California law:

"Assets and income of public officials which may be materially affected by their official actions should be disclosed and in appropriate circumstances the officials should be disqualified from acting in order that conflicts of interest may be avoided."
- Gov. Code section 81002(c)

"No public official at any level of state or local government shall make, participate in making or in any way attempt to use his official position to influence a governmental decision in which he knows or has reason to know he has a financial interest."
- Gov. Code Section 87100

Nichols hasn't addressed how she'll handle any ARB business that involves Exxon or the oil industry in general. Her refusal to get rid of the stocks outright is worse than tone-deaf, given that the oil industry is among the chief targets of the global warming bill her agency is supposed to enforce.

Here we were, just worried about Schwarzenegger's ties to Big Oil. Now Nichols has opened herself to doubt on nearly every decision she makes -- whether the order came from Schwarzenegger, or from her own family's economic interests. We're waiting to see if the Legislature or Atty. Gen. Jerry Brown, who has focused hard on greenhouse emission enforcement, will take a hard look at Nichols' conflicts.

back to top


E-mail comments to ArnoldWatch at

Home | Subscribe | Donate | Get Involved | Contact Us | Privacy Policy    
ArnoldWatch is a project of the Foundation for Taxpayer and Consumer Rights, a non-profit, nonpartisan organization. FTCR does not endorse or oppose candidates.