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BP = Beyond Petroleum OR Big Polluter?

In my last blog post „Does a company do well, by doing good“ we saw that it is sometimes very difficult to differentiate between a „good“ and a „bad“ company as far as Corporate Social Responsibility concerns.  In this and the next blog post I want to get to the bottom of things and find out if and how BP’s and Exxon Mobil’s CSR behavior, both companies have already been mentioned in  tmy last blog post, changed after the big oil spilling disasters. This post will dedicate to BP and the “Deep Water Horizon disaster” of 2010 and the next blog post will report about its competitor Exxon Mobil’s which was responsible for the oil spill catastrophe  “Exxon Valdez oil spill“ in 1989.

What makes the oil spill a matter of social responsibility?

This is the question Chris MacDonald raised in his blog “BP and Social Corporate Responsibility”
He comments that all business processes imply externalities and that all businesses emit directly or indirectly pollution and that in the end society at large has to pay for the resulting negative impacts caused by those accidents.

So the question of CSR has to do with the extent to which a company is responsible for those effects, and (maybe) the extent to which companies have an obligation not just to avoid social harms (or risks) but to contribute socially (beyond making a product people value).

by Chris Mac Donald

BP- BEYOND PETROLEUM: Green or Green wash?

The very fact that BP made it onto the Global 100 list of the “Most Sustainable Companies in the World” in 2005 and 2006 points out that we should be very skeptical about rankings and companies which looks sustainable. Sometimes they are just “green” at the first sight.

In contradiction to the Global 100 list of the “Most Sustainable Companies in the World” mentioned in Chris blog post, the blogger Polluter #3 reports that BP was named by Mother Jones Magazine, an investigative journal as one of the ten worst corporations in both 2001 and 2005 based on its environmental and human rights records. Besides being ranked  25th on the list of the 100 worst air polluters in the U.S by the Political Economy Research Institute, CARMA blamed BP for releasing over 8.7 million tons of atmospheric carbon dioxide each year.

Bad news!

As stated in the blog post the company was fined $1.7 million for burning polluted gases at its refinery in Ohio. In July 2000 BP had to pay $10 million for its management of its American refineries and according to PIRG research, BP was responsible for 104 oil spills between January 1997 and March 1998. When BP changed its name from British Petroleum to Beyond Petroleum it won the satirical award for best greenwashing campaign. BP spent $93 million on advertising in response to the Deep Water Horizon disaster in 2010. Although BP hasn’t managed so far to complete compensation payment and to clean successfully the 4.9 million gallon oil spill more than a year after the disaster began, BP received permisson to resume offshore drilling in the Gulf of Mexico!

Good news!

Blogger addtum agrees with Chris as far as the advertising costs concern and points out that BP tries to change its bad image. Besides the attempt to reduce CO2 emissions to underline their public relationships efforts by 2002 the company had succeeded in reducing emissions to 10% below 1990 levels which was actually more than the Kyoto Protocol demanded. Moreover BP made investments in alternate energy and became the 3rd largest maker of solar panels in the world.

The Deep Water Horizon Disaster

According to the Daily Mail article “Is this what you call ‘back to normal?’: Day after scientist hail recovery of Gulf Coast, new pictures show the real damage” the explosion on BP’s offshore drilling rig in the Gulf of Mexico on the 20 April 2010 resulted in the death of eleven people and caused the biggest accidental marine oil spill in the history of the petroleum industry. The accident sent over 170 million gallons of oil gushing into the Gulf of Mexico and the disaster is supposed to be worse than the big oil catastrophe by Exxon Mobil in Alaska in 1989. More than 8,000 birds, sea turtles, and marine mammals were found injured or dead in the six months after the spill. The long-term damage caused by the oil and the nearly 2 million gallons of chemical dispersants used on the spill may not be known for years.

One year after Deep Water Horizon! What has changed?

Ariel Schwartz commented in her blog posts “One Year After The BP Oil Disaster, What Has Changed?” and “BP Greenwashes Post-Deepwater Horizon CSR Report” that BP would like us to believe that the offshore business is safe now.  According to BP’s first corporate responsibility report since the Deepwater Horizon catastrophe, the company asserts that it is working on better safety metrics and that it also improves process safety techniques through “Enhanced training and development programs”. Furthermore the government wants to implement regulations to prevent further blowouts. The truth is that these regulations haven’t been implemented so far and so offshore oil projects continue to be realized. However it comes worse. The Bureau of Ocean Energy Management, Regulation and Enforcement needs up to two year to approve the updated spill response plans of oil companies which allows companies like BP to continue their projects before its plans are approved!

Is BP’s Corporate Social Responsibility report misleading?

BP states that it recognizes the significant environmental and social challenges faced by the world in the 21st century. It believes it can and should play a part in addressing and resolving many of the issues associated with sustainable development. It also reckons that while the company can be part of the solution it cannot and should not be the whole solution. Governments, companies and civil society must find effective ways of working together.

Ariel revealed that in BP’s first Corporate Social Responsibility report after the oil catastrophe the company had tried to smarten up the figures. On page one of the report, BP completely had ignored to list the amount of oil and methane released as a result of the Deep Water Horizon catastrophe. According to BP’s report less oil was spilled in 2010 than in 2008. This definitely cannot be true!

We have not included any emissions from the Deepwater Horizon incident and the response effort due to our reluctance to report data that has such a high degree of uncertainty.”

quotation by BP

However Ariel bothers and criticizes that at least BP could have made some kind of estimation instead of leaving out the largest oil spill in U.S. history. BP dedicates two sections of the 50 page report–How BP is Changing, and the Gulf of Mexico Oil Spill–to the spill. In the “How BP is Changing” section, BP claims that it is working on improving safety and operation risk, values and behaviors, technology, and contractor management, among other things. Unfortunately the report skims only the surface of these issues. Ariel Schwartz estimates that in order to cover all facets of the oil catastrophe, BP would have to extend its report by at least another 100 pages.
In her opinion not much has changed in the offshore drilling industry!

Could there be a next Deep Water Horizon catastrophe tomorrow? Or do you think that offshore drilling companies are working more carefully lately?

Look forward to hearing from you soon! See you!


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