BP and Corporate Responsibility
There is no question that the Gulf of Mexico is Exhibit A in the business case for corporate responsibility (CR). If BP executives had chosen to build a strong ethic of authentic CR inside the oil company, the disaster would have likely been prevented by employees who would have demanded doing the right thing and blown the whistle on anyone who wasn’t.
But that didn’t happen, and the company has seen its market valuation drop precipitously, losing more than $100 billion as of this writing. And then we should add in accounting for the actual cost of cleaning up the mess and paying for the liability, which so far is approaching $1 billion. Analysts point out this is not that much given BP’s $20 billion in expected 2010 profits, but I think the longer this spill drags, the angrier people are going to get and the more blood will be demanded. When the final costs are tallied, BP could get a bill as big as the entire Gulf of Mexico and it could force the company into bankruptcy or to be sold to a competitor.
This makes one of the strongest business cases I’ve ever seen for CR, which would have organically reduced the company’s drilling risks significantly. I hate to say we told them so, but if BP had followed the advice coauthor Bill Breen and I offer in our new book, The Responsibility Revolution, it is dramatically less likely that any of this would have happened.
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Jeffrey Hollender is a well-respected leader in the socially and environmentally responsible communities.
Comments
Mon, 07/26/2010 - 17:13 — zilb01
Living in Glass Houses
People like Jeffrey Hollender who live in Glass Houses really need to watch where they throw stones. Statistics prove that Mr. Hollender has a hundred fold better chance of being killed in automobile accident than BP had for their recent Gulf of Mexico Environmental Disaster. Mr. Hollender’s comments in this article confirm that he is ignorant of the internal working of mega corporations like BP. Mr. Hollender chose a road less traveled when he wrote this article. Jeffery Hollender chose an opportunity for personal financial gain and joined the ranks of entertainment we often call the evening news. I personally find that Jeffery Hollender has sent a clear message which unquestionably mirrors his Seventh Generation Products.
Tue, 07/27/2010 - 11:01 — andra413
karma
You know what they say about karma. I think BP should end up bankrupt. I dont care what happens to that company. My Father and many others had thriving businesses thru the Amoco Corporation. When BP "merged" with Amoco, within a year they were forcing these good men and women out of businesses that some had for decades that they had built from the ground up. BP barred them from selling and did not give them any compensation whatsoever. I know atleast one man that committed suicide over BP's actions in the name of good business. They dont care about any of us and our ecosystem. All they care about is the bottom line, that almighty dollar. I went to Fla a few weeks ago, and let me tell all of you, it just sickens me to the core to know somewhere that I have went on vacation since the age of 4(I am 45) may not be there to enjoy ever again in the same way I have enjoyed the last 41 years, first with my parents, relatives and now my own children. My grandchildren will never know the gulf like I have. My family HAS seen the inner workings of BP corporation, and quite frankly it sucks.
Thu, 07/29/2010 - 22:13 — hvail1
Whatever....
I'm just as upset and outraged at this situation as everyone else. My opinion is different than most -- when the ink is dried on the various investigations, people can castigate the corporations / people responsible all they want. Until then, it is irresponsible to say that this is 'all BP's fault'. I'm not saying that it's not their fault, just saying that there is more than one corporate party involved here and it's likely that there is a lot of blame to go around. Just remember that BP did not own or operate the rig, they did not perform maintenance on the rig or the BOP. Lots of blame to go around.
And the gulf will return to normal quicker than people think. The media is polluting peoples' minds worse than the oil is. My opinion, y'all can castigate me all you want for it.
I'm officially taking my 'green' purchasing dollars elsewhere. I love your products but your irresponsibility in publishing this article without knowing the facts (and nobody will know all of the facts until the investigations are done) is outrageous. Whatever happened to 'innocent until proven guilty'?
Sat, 07/31/2010 - 13:51 — Dr. Michael Palmer
BP's Corporate Culture and Prioritization of Values
"If BP executives had chosen to build a strong ethic of authentic CR inside the oil company, the disaster would have likely been prevented by employees who would have demanded doing the right thing and blown the whistle on anyone who wasn’t."
We have volumes of research showing this statement to be true. Diane Vaughan contributed a major analysis of what she called normalization of deviance in the NASA culture and that of Morton Thiokol leading to The Challenger Launch Decision (see her book of the same title: http://www.press.uchicago.edu/presssite/metadata.epl?mode=synopsis&bookk...). Johnson & Johnson's response to the Tylenol Cyanide murders is frequently cited as an example of hundreds of employees knowing how to make the right decisions because they were guided by the company's famous Credo. (See, e.g., Robert Kniffin, "Corporate Crisis Management," Organization & Environment (1987).)
News reports in the Financial Times and elsewhere indicate that BP's real prioritization of values was askew, putting greater emphasis on cost cutting than on safety. Thus, Jeff Hollender's statement appears to be correct.
That said, building a "strong ethic of authentic CR" inside a company is much easier said than done even for those who want to go there. For a giant corporation, such a move is a monumental undertaking.
For more on the ethics of BP's response to the spill, see www.EthicsDialogue.com.
Mike Palmer
Cornwall, Vermont