BP, Gulf Oil Spill and Accountability

I was reading a Facebook posting this morning in which an acquaintance was forcefully suggesting that the CEO of BP be jailed because of the Gulf oil spill. At first I thought his comments were a bit harsh. After all, how could the CEO be responsible for such a tragedy?

I then remembered teaching about accountability several weeks ago. I asked the following question of all the people who work in a health care company, “who is accountable for the success of your company?” After some discussion, they all agreed that each of them is accountable for the success of the business.

Why were these people so clear about accountability and CEOs of company’s such as BP don’t seem to have this same sense? Before I attempt to answer that question, it might be useful to explore what accountability is. Having contemplated this topic for many years, I have arrived at a simple definition of accountability. Accountability is accepting responsibility for the consequence of my thoughts, words and actions. Where I find people start shying away from this definition of accountability is when they consider the notion of consequences.

Let’s take accountability for the gulf oil spill, for instance. The CEO of BP recently reported to the press and shareholders that he doesn’t expect BP to pay any more than $3B as an outcome of the spill. First, how could he possibly know that, but I will not engage that question. What is most telling is that his concerns are in terms of money. He recently assured his shareholders that their dividends will be uninterrupted. Uninterrupted flow of money to the shareholders of a company that has impacted millions of people along the gulf coast at this point. We have no idea the ultimate impact on our eco-system, yet the CEO of BP is assuring shareholders that their dividends are intact.

This is a major aversion of accountability in my book. First of all the shareholders of the company are, at present, not accepting any accountability for the gulf spill. You may ask, “how could they?” Good question, with what I believe is a good answer.

The shareholders of any natural resource company know, even if they don’t admit it even to themselves, that exploration and transportation of substances such as oil or gas or coal has risks. In our pursuit of oil, for instance, we are drilling and extracting oil at ocean depths where we don’t know the consequences or risks. It is mostly uncharted territory.

The shareholders can find out, if they are interested, how much BP spends in research of the impact of their drilling and extraction on the offshore environment. The answer to this question is woefully small. So BP’s leadership chooses to embark on a venture for which they did not understand the risks. If they had look at this from the cold eye of science, they would have understood that the kind of disaster we are experiencing was inevitable. It was only a matter of when and to whom.

This very high form of Russian Roulette is risking the livelihood of so many not to mention the, at least, temporary destruction of parts of the ocean. I know some feel that they ocean is so big, how could one little spill matter. Just watch and find out. Everything on this planet is connect in seen and unseen ways. We won’t know for some time the consequence of this spill.

Now back to accountability and the oil spill. Its complicated and simple. At the most simple, we are all responsible. I have written about this approach to accountability on many occasions. Let me explain why I say, “we are all responsible.”

The force that drives BP to take such risks is our insatiable desire for oil and its by products. This desire is not just for more, it is for more that is cheap. The second desire, cheap oil, is going to come crashing down soon and the leadership at BP know this. When that happens the desire for oil at any price will arise, which will mean extraordinary profits for companies such as BP.

Because of this demand and the worry of oil folks that we are getting at the end of production of many of their existing oil fields, BP and others are spending great sums of money in extremely risky ventures such as oil extraction at over 1 mile in ocean depth.

This accountability chain also includes the leadership of BP. They are rewarded by their shareholders for taking risk. Their hands are slapped if they get caught, like in the case of the oil spill. Yet the leadership is left in place and their boards extend confidence in them. The only meaning I can make of this is that they approve of the course they have taken in the past and expect them to continue on this course in the future. The current problem is just a small detail to be managed.

Which takes me to back to the shareholders. The board of directors ostensibly represent the values and concerns of the shareholders. If that is true, the shareholder’s primary concerns are how much money they can make from being BP owners. This focus has at its core significant consequences. The primary of which is that it motivates the BP leadership to take actions to satisfy their owners that can be disastrous for all of us.

In listening to many environmentalist over the past few weeks, I find a common thread. They are hopeful that we can learn from the gulf coast spill and prevent future disasters. I am hopeful as well, but believe the lessons lie in changing the basic motivation of humans. This would mean that we substantially change our economic system from one that rewards financial results above all else to one that rewards doing the right thing for everyone.

This may sound myopic or polyannish. I don’t think so. There are plenty of resources for us all to have a rich life. We will all be robbed of this possibility if we continue on the path of money rules. Remember money doesn’t follow us to the grave. Money won’t give us great relationships or fill our life with joy. Doing the right thing can give us all this and more.

Think about it as you make your choices today.

Author: Thomas White

Over the past thirty-five years, Thomas White has created and led private and public organizations that initiated breakthroughs in areas as diverse as computer software, publishing, printing, market research, leadership development and organizational change. The common ingredients in his success are simple. He looked beyond the limitations that others believed and found real solutions to needs that business leaders have. He attracted the best talent to translate these innovative solutions into practical products and services that were of high value to customers. He created cultures where people love what they do, work at their best and produce extraordinary results. In addition to his role as a business leader, Thomas has been a pioneer and inventor of technologies in the computer-networking field. He is a patent holder for innovations in business process and workflow technology. As part of his passion for educating others about the interface of human and computer systems, he was the co-author of “New Tools for New Times, The Workflow Paradigm”. He has also written articles for numerous publications. In 2001, he turned his attention from leading companies to supporting leadership teams in creating organizations of excellence. After many years of being a part of the machine of change, Thomas recognized that business is the most powerful force in the world. It has a major impact on public policy and governments everywhere. It is a key influence on how we use our resources and sets an example of the values that shape communities from local to global. He formed the consulting firm of Profoundly Simple to be a guide for exemplary leaders - leaders who wisely uses the power they are entrusted with to serve their constituencies first and themselves second; leaders who know that it is good business to treat people with respect, honor the environment and act with impeccable integrity – leaders who inspire greatness in those around them and by doing so create great organizations that are notable examples of success. Feeling the itch to get back into the game again, Thomas joined with two long time friends, to start the C-Suite Network. This network of business leaders offers an online network, events, services, and insights to its 500,000 member community. In addition, the C-Suite Network produces and distributes television and radio content to an audience of over 5M per month

2 thoughts on “BP, Gulf Oil Spill and Accountability”

  1. This is right on. An economist would say that the oil spill is a huge negative externality – a cost borne by individuals who had nothing to do with the decision to drill (unless they were BP shareholders or decision-makers) that is not reflected in the price of the product.

  2. This is a really tough situation. BP is all for capitalism when it works for them, but when they are ultimately responsible for it…we’ll see what happens. I believe that they are completely shirking their responsibility for this. Unfortunately, sending a message to the company will hurt us more than them.

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