BP Case Analysis| | 1. Based on the history of the company, why did BP get involved in so much questionable conduct? BP’s history extends back to 1901 when William D’Arcy’s Anglo-Persian Oil Company first drilled for oil in Persia and after seven years of drilling and darcy’s nearly spent his net worth finally oil spewed out and became rich. Unfortunately later at 1914 BP was on the verge of bankruptcy due to the very low demand of oil in global market.
Accordingly ,BP’s Board strategy focused for decades on selling and making profits by expanding and increasing their market shares and they have neglected BP responsibilities with respect to human and environmental resources in their Mission statements and Corporate goals . Below is part of their new mission statement and underlined parts emphasize how BP have changed their way of thinking and realized how social responsibility and environment are important to their business especially after several disasters that occurred to them last decade. Mission statement: BP wants to be recognized as a great company – competitively successful and a force for progress. We have a fundamental belief that we can make a difference in the world. We help the world meet its growing need for heat, light and mobility.
We strive to do that by producing energy that is affordable, secure and doesn’t damage the environment. BP is progressive, responsible, innovative and performance driven. ” “Progressive – We believe in the principle of mutual advantage and build productive relationships with each other, our partners and our customers. “Responsible – We are committed to the safety and development of our people and the communities and societies in which we operate. We aim for no accidents, no harm to people and no damage to the environment. ” “Innovative – We push boundaries today and create tomorrow’s breakthroughs through our people and technology. ” “Performance Driven – We deliver on our promises through continuous improvement and safe, reliable operations. ” Source: BP. com 2. Analyze BP’s efforts to improve sustainability and its reputation.
Do you think they are sufficient, or does the company need to do more? As BP has previously lost sight of its responsibilities to the environment, employees ,society and shareholders and they have neglected legal (Illinois case) and social environment (Prudhoe Bay) in their strategy which resulted in several disasters and caused them to pay millions of dollars penalties and damaged their reputation. BP has taken major steps toward repairing its image.
BP changed their corporate mission goals and objectives and took deep consideration to environment and social responsibilities that drive all its global business units to follow same strategy in their missions and goals and took initiatives to prove consistency in new promises: * Changed their name to BP and removed petroleum to focus on full spectrum of energy resources. * First global energy firm to announce its recognition of greenhouse effect. * Launched BP code of conduct and published it globally in website to be strictly followed by all BP employees. * Launched BP alternative Energy business in 2005 Wind-Solar-Biofuels). * Heavily invested in environmental care in their projects (Alaska – Algeria) through the specialized BP’s remediation management team. * Stakeholder Education of environmental awareness and launching Carbon footprint kit which was highly perceived accordingly BP was awarded in 2007 (IVCA) awards. I think what BP has done so far to repair its image is good but most important that they keep sustaining the same strategy regardless of economy or corporate management changes and they need to do more effort to make sure that code of conduct is strictly applied worldwide. . Do you believe that BP Code of Conduct will prevent future misconduct ? Why or why not? Code of conduct is essential to be written and published for any global company but most important is how to make sure its implemented and nobody is violating it and causing disasters. From my opinion that BP publishing code of conduct in 2005 was not enough and the evidence for that was disasters happened later 2006 – 2007 and finally 2010 (Oil spill in Gulf of Mexico) Below case demonstrating and emphasizing my opinion.
What BP was missing on Deepwater Horizon: a whistleblower Oil spill in Gulf of Mexico By Eleanor Bloxham, contributorJune 22, 2010: 4:25 AM ET FORTUNE—- The opening letter from BP CEO Tony Hayward to the BP Code of Conduct reads: “If you are unsure of what to do in particular circumstances or concerned that the code is being broken, you have a responsibility to speak up. The code explains the mechanisms to do this . . . and the protections to ensure that retaliation against those who do speak up will not be tolerated. “
However after CEO speech some rig survivors started to speak and they said “It was always understood that you could get fired if you raised safety concerns that might delay drilling. Some co-workers had been fired for speaking out. ” Taking this case as an example, BP should have raised culture of its employees by making seminars and speeches done by top management to ensure importance of implementing code of conduct and how company will protect its employees or even reward them form preventing rules getting broken even if it requires shutting off a rig and loosing a lot of money. Source: money. cnn. om 4. How can BP prove to its stakeholders that it is serious about social responsibility ,sustainability , and ethics, and that its efforts are not just a public relations ploy? BP has started already to prove its seriousness to its stakeholders regarding ethics and environment issues by implementing environmental awareness programs to stakeholders and establishing (BPES) BP educational service who initiated the Carbon Footprint Toolkit which was later implemented in High schools in Britain and increased envormental awareness form 62 to 89 percent and this project got international award in 2007
From my opinion BP should launch frequent seminars for its stakeholders showing its contribution in global environment like (Alaska –Algeria ;amp; CSS initiative) and saving energy projects like BP Zhuhai and showing impact of this success stories on environment and society nevertheless saving million of dollars results to emphasize to its stakeholders that being environmentally sustainable and ethically responsible is not only the right thing to do but also can be profitable and its becoming one of BP goals and strategies and even becoming on of their competitive edge and thrive.