CSR Case Analysis: British Petroleum

 

Final Case Analysis: British Petroleum

BP’s immoral practices caused the Deepwater Horizon oil spill disaster. In 2010, BP, Halliburton, and Transocean were involved in the Deepwater Horizon oil drilling when it exploded, killing 11 workers and millions of marine wildlife (Smith et al., 2011). According to investigations, negligence resulted in the spill, as BP and Transocean had detected problems during testing but ignored the warnings (Smith et al., 2011). Another moral issue is that BP made poor decisions to save time and money and failed to adopt appropriate controls to address the increased risks.

The US has a mixed economy with capitalism and socialism elements. As a capitalist economy, private businesses have the freedom to generate goods and services (Ugwu & Moko, 2017). Nonetheless, the government is supposed to enact laws to ensure private businesses operate ethically in a socialist economy. The US government lacked regulatory oversight over the oil industry, making the oil spill disaster possible. The laws that affect BP include the Migratory Bird Treaty Act (MBTA), Oil Pollution Act, Resource Conservation and Recovery Act, Clean Water Act (CWA), and Comprehensive Environmental Response, Compensation, and Liability Act (United States Environmental Protection Agency, 2021).

Ethical Theory

Oil drilling companies have a moral responsibility of committing to safety first. As such, BP and other oil corporations will not cause another oil spill catastrophe in the future. The ethical theory that supports this moral position is utilitarianism. The main maxim of utilitarianism as a consequentialist theory is that something is moral if it results in the greatest good for the greatest number of persons (Fieser, 2015). Therefore, oil companies should ensure the outcome of their operations benefits a large number of people. In this case, BP was immoral because the decision to save time and costs aimed at benefiting only a few people, such as BP staff, executives, and shareholders. Secondly, the fundamental thing in utilitarianism is happiness; actions are wrong if they cause unhappiness and ethical if they enhance happiness (Fieser, 2015). BP was unethical since its negligence and lack of safety policies during oil drilling led to an explosion that made people and marine wildlife suffer. Moreover, by using utilitarianism, oil corporations will have to implement strong safety standards to protect people and the environment.

Premises

The government should have regulations obliging oil companies to adhere to world-class safety standards. According to Smith et al. (2011), if the relevant government agencies had the necessary safety regulations in place, the Deepwater Horizon would not have occurred. Specifically, the oil industry had become complacent in overseeing the operations of oil drilling companies.

With a mixed economy, the United States government is supposed to protect workers, citizens, and the environment from corporations that only focus on profits. The government can do that by developing strict laws for the oil industry. Socialism is about considering both individual and social needs (Ugwu & Moko, 2017). It also entails preserving natural resources for the good of the whole society. Companies can promote social needs and preserve natural resources when they are required to follow government safety standards. The oversight of the Oil Pollution Act (OPA) could have prevented the BP incident. The OPA has provisions to enable the federal government to avert oil spills and respond to such accidents (United States Environmental Protection Agency, 2021). However, the OPA should have meaningful spill penalties to force companies to have adequate environmental contingency planning.

Oil corporations should rethink corporate social responsibility to promote safe operations. In order to be moral, companies engaged in oil drilling activities must be fully committed to corporate social responsibility. Cherry & Sneirson (2010) pointed out that the BP oil explosion took place due to the company’s superficial engagement in corporate social responsibility and poor corporate governance. For that reason, if companies were genuine about corporate social responsibility, they would strive to be moral (Schwartz, 2020). They would follow the principles of utilitarianism and avoid actions that might cause unhappiness for many people. One way of doing that is promoting corporate governance and thinking beyond profits. Corporate governance would encourage accountability and transparency, which are necessary for observing utilitarianism. Oil spillage accidents are preventable if the management of oil companies makes utilitarian decisions. For example, making sure that the outcomes of company decisions make the community happy would meet the requirements of utilitarianism theory. Taking all the necessary safety precautions to conserve the environment when drilling oil is another utilitarianism strategy.

Comparative Analysis

           In the BP oil disaster case, utilitarianism theory is better in offering a moral solution than deontology. According to the deontology theory, doing the right thing involves observing certain duties or rules (Conway & Gawronski, 2013). Hence, BP should have adhered to particular rules to prevent the oil explosion and spillage that occurred in the Gulf of Mexico in 2010. However, there were no clear company guidelines or government rules for BP workers to follow to be ethical under deontology. Besides, deontology is inflexible, as it emphasizes the universalism of duty and ignores unique circumstances (Conway & Gawronski, 2013). The list of the required duties is also not definitive. Although BP should follow some duties and principles to be ethical, it also needs to consider the circumstances in its environment. For instance, BP offers other services such as fuels, lubricants, and air fuels. Hence, BP’s ethical strategies when offering the products could be different from what it applies in oil drilling operations. Nonetheless, deontology would not allow BP to alter its ethical strategies to match particular business circumstances.

As noted, utilitarianism theory has various strengths when presenting the moral solution of BP’s ethical problem. Firstly, utilitarianism maximizes the greater good and reduces harm (Conway & Gawronski, 2013). Thus, oil companies are required to think about the action that leads to the most benefits for most people. They would have to consider not only the staff and executives but also the whole society. Protecting the environment would be one way of making society happy. Additionally, utilitarianism assumes that the happiness of all people is equal. As such, BP and other oil corporations should treat all stakeholders equally. The happiness of the executives, staff, shareholders, customers, and society is equal.

Objection to the Thesis

            Some people may object to my thesis by arguing that the culture of the drilling sector caused the Deepwater Horizon oil spill tragedy. Notably, the drilling industry had lasted a long period without a significant accident. Therefore, BP and its partners just assumed it was the norm to expect safe oil drilling operations. BP had experts, but they did not think the existing risks could turn into a tragedy. The federal regulators also approved all the stages of BP’s operations during the Deepwater Horizon. According to Cheong (2014), the government should develop and enforce laws to manage and respond to disasters. Since the government had signed off BP’s operations, the company became overconfident. BP continued digging deeper and ignoring risks.

BP and its partners had good safety records, and their employees were not necessarily unethical. BP was not aware it was making reckless decisions. Although BP valued speed and efficiency, it did not put its workers in danger intentionally. If it knew that it’s cost and time-saving strategies would result in a devastating accident, it would have managed the risks. Big disasters were not common in the drilling operations; hence, the government did not have strict safety standards for the players (Smith et al., 2011). Due to the sector’s lenient culture, BP made small, flawed decisions that later turned into the enormous Deepwater Horizon oil spill. BP had moral employees who only realized after the disaster that they had engaged in unethical practices.

A Rebuttal

           The above objection to the thesis is essential, but it does not fully eliminate BP’s ethical responsibility to prevent the Deepwater Horizon oil spill. The culture of the oil drilling industry only played a small role in causing the accident. The government and the oil drilling industry indeed failed to enforce a culture of high safety standards. They made BP reluctant in ensuring its operations were safe. On the other hand, BP had the most significant accountability in managing the risks of oil drilling. Independent investigations showed that BP could have prevented the oil spill if it had taken the necessary actions after detecting crucial problems during the testing stage (Schwartz, 2020). Besides, BP was digging deeper than it had ever done before. Thus, BP’s executives and involved personnel were aware that the deeper the wells, the higher the risks of spillages. It was unethical of BP to fail to address the additional risks. Therefore, despite the objection, the facts are clear that BP is also to blame for the oil spill.

Closing Remarks

This essay strived to show that the Deepwater Horizon oil spill disaster occurred because of the interplay among the government, the drilling industry, and BP. As a result, it shows that BP is not solely to blame for the disaster. The failure of the government to have strict safety standards for drilling introduced reluctance in the industry. Most people are not aware that the Deepwater Horizon tragedy was not from one mistake. The disaster took place because of the small wrong decisions that BP had been making over the years. The company and others in the industry became overconfident with their expertise and safety protocols. At the same time, BP ignored ethical principles. Indeed, the utilitarianism theory of ethics could have enabled BP to avoid the Deepwater Horizon oil spill. BP could have made better decisions to enhance the happiness of the entire society. Besides, the government needs to have strong regulations to ensure that BP and other oil corporations do not cause future oil spillage. BP should commit to corporate social responsibility, safety, and corporate governance before it focuses on profits.

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