Another environmental disaster, this time in the Gulf of Mexico, and industry again is getting its image pummeled by the media, concerned (and embarrassed) politicians and opportunistic environmental activists. There will be plenty of time and plenty of blame to go around, and the lawyers are already carefully advising companies on how to wordsmith their statements (eg, BP is responsible but not liable). Whatever their lawyers will come up with though, we need to ask: How many more disasters does BP have to be involved in before we find a way to say ‘Enough’.
Texas City was no accident, nor was the Thunder Horse disaster in Prudhoe Bay. The US authorities had chastised BP for a litany of safety and security breaches (even during the Bush years) and have imposed a catalogue of fines and investigations. Should we just accept their mea culpa now and trust their promise that they will be better? BP spends an enormous amount on PR – a nice sunny logo suggests that they are beyond petroleum, but their investment record there is dismal. They chose instead to pimp their reputation in tar sands, trader irregularities, shoddy alliances with questionable partners and cutbacks in safety standards. Consultants and lawyers love to fill their timesheets with clever projects that defend the indefensible, but the reality is that the company never had the intention to change nor the integrity to admit it.
A few years back I was marginally involved in an exchange of assets with BP. What was particularly difficult was to negotiate with an organisation that did not have a human resources department. BP outsourced its HR. What sort of company outsources human resources? One that doesn’t give a toss about anything other than making profits. They have a cut-back and cut-throat culture that makes them competitive, but not socially responsible. They do the bare minimum (or even less) to comply with the laws, try to change the laws, cut corners to maximise their profits and then get the lawyers out to twist things around when things understandably go wrong. They are opportunistic beyond the bounds of integrity. This is the image of BP but many people stereotype this as the image of industry.
Companies, like people, come in many stripes and colours. Their visions and cultures can range from unbridled opportunism to measured and sustainable interaction with clients and communities. Some companies and CEOs have committed themselves to improving standards, voluntary commitments, innovations that add value to society and avoid relationships that could damage their integrity or culture. They make a business case for CSR and lead their industry as a whole to new targets. I saw this when I worked at Cefic with leaders driving product stewardship and Responsible Care forward. But if a laggard like BP or, later, INEOS, were in the room, they would often fight to lower these targets or pay nothing more than lip service to them. They had bills to pay (especially after “Ratcliffe’s Revenge”) and margins to increase.
Industry associations are forced to move to the lowest common denominator and so they were often successful in stopping sustainability initiatives. When markets tighten, and BP’s profitability goes up compared to the competition, shareholders of other companies put pressure on their companies to abandon voluntary commitments and social responsibility. In other words, BP’s cut-throat culture drags down entire industries. This will continue to happen so long as such a culture in such a company continues to thrive. What happened in the Gulf of Mexico was not the fault of industry, it was the fault of BP (and it will happen again).
Now that BP is twisting in the wind, I cannot resist the chance to pontificate. I am doing my gardening and I know that my flower bed will grow better if I pull out the weeds roots and all. This needs to be done to BP in order to let the rest of the industry improve and thrive. Whether it is through the stock market, the legal and moral Gulf cleanup bill or through customer boycott, BP is a weed that should be yanked as hard as possible. It would create a text-book case study for generations of business ethics students to come.
As Obama has his boot to BP’s throat (an image I just can’t get out of my head), I would only kindly ask him, for the sake of industry as a whole, to press a little harder.David Zaruk