During the past years Corporate Social Responsibility (CSR) has become an important part of the global businesses. More and more companies have started acknowledging the advantages, because more stakeholders are caring about health, the environment and other social aspects. Because of this change in the way companies do business, the oil spill in the Gulf of Mexico had many consequences for BP. The oil spill got a lot of attention from the media, NGO’s, the local society and the US government. As this is not the first oil spill BP has had, I wondered how many times a company can say I’m sorry, before the stakeholders stop believing in them. Isn’t it necessary to change how the company operates in order to avoid the accidents? What affect did it have on the BP brand and how can they recover and still have (and keep) the trust of the stakeholders? So this became my problem statement: How can BP get back the trust of the stakeholders and how are they able to keep the trust after the oil spill in the Gulf of Mexico? I wanted to make a new CSR strategy for BP, which took into consideration mainly the trust aspect. A big part of creating stakeholder value is the financial aspect. But in order to go more in depth, I’m only focusing on gaining and keeping the stakeholders trust. So this thesis is not about money, it is about trust, faith and believing in what you are told. In order to make a CSR strategy, I first had to find out who the target group for the strategy was. So first I identified the stakeholders, the stakewatchers and the stakekeepers. From this analysis I found that the most important stakeholders for BP were the US government, the shareholders, the employees and the local society affected by the oil spill. After the identification I examined which external factors, internal factors, business factors and HR and financial resources that would be important to take into consideration when making the CSR strategy. The most important factors were the conclusion from the commission, that the safety on the drilling rig hadn’t been sufficient and this is what led to the large fines for BP. I also found out that the commission would recommend a tightening of the existing laws regarding safety. They would also recommend larger fines. The oil spill also affected the BP brand and the value of the brand was 0 USD a few months after the catastrophe. BP had a loss in 2010, but already in 2011 they were making a profit again. So in spite of the oil spill, BP is still a profitable company. However BP had a negative cash flow in 2011. The quick financial recovery is mainly due to the type of product BP produces. Energy is important for a lot of people and it is necessary for both companies and private people. I also found that BP doesn’t have that many casualties. It is mainly their subcontractors. However it does affect BP a lot. There are a lot of focus on the environment and especially the people living in the area of the Gulf of Mexico, are worried that it will take a long time before the nature and the environment of the area is restored. They are worried about the seafood, and whether it is safe to eat and therefore sell. There live a lot of fishermen in that area and the oil spill has affected them a lot. From this analysis I found that it is very important to do something about the safety on these rigs, so that accidents are prevented. The shareholders don’t like the insecurity of the value of their shares and risk and return are influenced by each other. The shareholders expect a larger return, if the risk increases. The oil spill got the stock value to decrease, which creates insecurity among the shareholders. It is also important to give something back to the society. For example BP could establish an aquarium for the sick fish and other wild life. Here they should get the treatment they need. It could be supplied by renewable energy. BP should also create a separate CSR unit directly under the board of directors. They should implement strict safety and CSR rules and implement them in the code of conduct. In order for a CSR strategy to work, the board of directors and the management should set an example and show the entire company that CSR is now a priority. In order to carry out these recommendations, management control systems are important. BP should use mainly action controls and result controls. They should make sure that unsafe behaviour is not possible and they should give the employees incentives like bonuses in order to motivate them to work in a more safe way.
|Educations||Graduate Diploma in Financial and Management Accounting, (Diploma Programme) Final Thesis|
|Number of pages||65|