I wonder what lessons other firms watching BP’s descent into ‘public enemy No.1’ status are likely to learn about how to respond to a crisis. From Day 1, BP publicly accepted full responsibility for the crisis (even while contesting fault) and promised to pay all reasonable compensation claims. The firm genuinely seemed intent on living up to the image it had crafted for itself as a good corporate citizen, as indicated by this quote from the article in the url below:
“The irony of this is that, early on at least, BP appeared to be adopting a textbook approach to corporate crises – dispatching its chief executive to lead from the front, taking responsibility for cleaning the spill and compensating victims. Mr Hayward was, laughable as it now sounds, eager to be a model corporate citizen and show that BP would be more responsive than Exxon Mobil after the Valdez disaster.”
I think many firms would not have been so forthcoming—instead, hiding behind legal statements about needing to wait until all proper investigations are conducted and then fighting tooth and nail in court to minimize compensation payments.
Even accounting for its PR mistakes, what has BP gained from its relative openness?
It is as if politicians and the media perceive the admission of responsibility as a sign of weakness, an excuse to posture (employing a slice of nationalism for extra measure), and an invitation to move in for the kill. What incentive will the CEO of the next firm to cause a disaster have to publicly take responsibility, apologize, and offer to compensate the victims? Looking at BP’s experience, I can imagine what the General Counsel’s advice will be.
Of course, it would have been ideal if BP had thought through the consequences of deep-sea drilling in advance, made sure its back-up equipment worked, developed a half-decent disaster response plan in case anything went wrong, and was transparent with information when it did. But, even if firms take all these steps, accidents will happen and, when they do, it is in society’s best interests to encourage firms to accept responsibility, rather than hide behind lawyers. My sense is that the BP disaster has made hiding behind lawyers more, rather than less, likely in the future.
Take care
David
Bill Werther & David Chandler
Strategic Corporate Social Responsibility: Stakeholders in a Global Environment (2e)
© Sage Publications, 2011
http://www.sagepub.com/strategiccsr2e/
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How not to salvage a reputation, at BP and beyond
By John Gapper
756 words
24 June 2010
Financial Times
Asia Ed1
09
http://www.ft.com/cms/s/0/0d3a10c8-7f0c-11df-84a3-00144feabdc0.html
or
http://xinkaishi.typepad.com/a_new_start/marketing/
