Its reputation in tatters, facing $20 billion compensation costs and with the share price halved, can any good come out of BP’s Gulf of Mexico debacle?
As we go to print, it’s looking like an effective cap may finally be in place on the Macondo well, a mile below the water’s surface. Praise be, as the environmental and human costs were escalating dramatically. It’s a corporate catastrophe too for BP, where its recent record hasn’t helped: the Texas refinery fire which killed 15 in 2005, the Alaska pipeline leak in 2006 and now the Deepwater Horizon explosion which killed 11 workers.
Truth told, BP has been losing friends in the USA for some years, not helped by a record of declining community contributions overall and in neighbourhoods around plants, in contrast to rivals like Exxon. Community investment may be the Cinderella of CSR but it can maintain reservoirs of goodwill, useful when the storm breaks. The end result, as we report in this edition, is BP being more reviled than Wall Street bankers. That takes some doing.
What lessons can we learn? For one, obviously, health, safety and environment isn’t a nice-to-have but something investors really need to focus on. In this edition we report some signs that mainstream investors are broadening their field of vision. We also report a UN study showing that sustainability was already rising up CEOs’ agendas, even before the oil started gushing.
Less noted so far is that this affair surely ought to sound the death-knell of the old ‘responsible capitalism’ line – get government off our backs, don’t tax or regulate us, the mantra used to go, you can trust us to behave responsibly. Yet here we have a President in the land of red-tooth capitalism who now feels free to – in effect – set the dividend policy and sack the chief executive.
Is there a silvery sheen to this oily slick, to mangle my metaphors dreadfully? Only if Deepwater sends a wake-up call to those who still think that responsible and sustainable business is anything other than a fundamental bottom-line issue.
Mike Tuffrey is founding editor of Corporate Citizenship Briefing, and founding director of Corporate Citizenship. In addition, he is an elected member of the London Assembly and has been appointed by the mayor to the London Sustainable Development Commission.
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