To demonstrate “responsibility”, BP spent huge sums of money on an advertising campaign promoting the notion that fossil fuel emissions of carbon dioxide is to blame for global warming and its investment in renewable energy was proof the company was seeking a future that was “beyond petroleum”.
The message was clear: oil is bad for society and BP is leading the way in alternative energy.
The BP experience shows there are serious consequences when companies demagogue against its core business. Not only was BP’s negligence to blame for the refinery tragedy, the company was also responsible for the largest oil pipeline leak of 200,000 barrels on Alaska’s North Slope. The oil leak forced BP to shutdown most of the pipeline this summer causing price disruptions in the gasoline market.
Not surprisingly, these disasters resulted in a significant amount of criticism. “If you drew up a list of companies that Americans are most disappointed in, BP would definitely feature,” said James Hoopes, professor of business ethics at Babson College, Massachusetts.
Ironically, BP’s experience delivered the exact opposite of CSR’s promise: the company’s reputation was ruined, the company is the target of government agency investigations and Congressional hearings and its stock price lags far behind its competitors and the S&P 500.
Unfortunately, in the aftermath of BP’s failures, many critics blamed corporate greed – not CSR – as the cause. They believed the profit motive forced the company to skimp on basic pipeline maintenance and worker safety.
This conclusion is far from the truth. If profit were its only goal, BP would define its role in society as a company that safely producing oil while providing jobs and energy for the economy.
The real culprit is Lord Browne who diverted management attention and money away from its core business. Regrettably, Lord Browne has yet to learn his lesson. Shortly after settling the last lawsuit from the refinery explosion BP is once again running its full-page ads touting its investment in solar energy.
If the organizers of the BSR conference were honest, they would include BP as a case study on the real “measurable impacts” of CSR and warn businesses of the risks for companies that adopt the politically correct definition of a socially responsible company.