Corporate Responsibility And Governance: A Study Of BP Oil Spill In Gulf Of Mexico

The Ethical Issue Related to Oil Spill in Gulf of Mexico

Discuss about the Corporate Responsibility and Governance.
 

On 20 April 2010, the incident of “BP Oil Spilling” took place in the Gulf of Mexico. Deepwater Horizon oil drilling platform, was responsible for this particular incident. The platform was responsible for blowing out a wellhead in the Gulf of Mexico; the incident took place around 40 miles towards the southeast of Louisiana coastline line. British Petroleum multinational gas and oil company, initially, although had claimed that the spill that will take place would affect the environment in a minimal way. The incident although turned out to be the biggest offshore oil spill incident in United States of America. BP, although was warned by many of the independent scientists (Brennan 2013). The scientists asked BP to not to set up the instrument on the ocean floor. British Petroleum being the multinational oil and gas company, although did not pay heed to any of those warnings and today the environment and the ecology of the world is paying the price of this ignorance. 69 days after the incident took place, the well was leaking out 3, 00,000 litres of oil each day. The experts, who had look at the footage of the leakage, are of the opinion that the amount is at least 3 or 5 times more than that.

United Kingdom based company, British Petroleum or the BP is a multinational oil and gas company that operates in more than 80 countries (Ritchie, Crotts, Zehrer and Volsky 2013). The company produces around 3.4 million barrels of oil each day and is the third largest energy producing company in the world. BP is responsible for exploration, production as well as for the distribution and the refining of the oil. The company with such a grand image should have achieved the summit easily, but the 2010 explosion or the spilling of the oil changed the whole image of the organization.

(Figure 1: The Areas Affected by the BP Oil Spill

Source: Brennan 2013 )

The explosion, as mentioned earlier, is the largest oil spill in USA, which made the Obama government investigate the matter. Therefore, the government set up a commission, to identify the causes behind this particular matter. The commission soon found out, the organization along with its partners as well as the government made certain mistakes, which they would have easily avoided. The three parties, if they would not have committed these mistakes then they would have easily avoided the explosion, that occurred in the Gulf of Mexico (Bond 2013).

Utilitarianism and Deontology: An Ethical Perspective on BP Oil Spill

The particular explosion or the incident, made the wildlife around the Gulf of Mexico suffers a lot. The oil spill affected the reputation of BP in the global market. BP’s reputation, although was affected in the year 2010 as well. During this year, in Texas, an accident took place in the refinery, which took the life of around 15 people and almost 180 were injured (Issacharoff and Rave 2013). Later investigation proved that the company was focusing on two things at that time. The two things were high production and cost cutting. Therefore, these two factors lead to the serious deterioration of safety regulations that are followed in the refinery. Next year, BP’s reputation was again affected when 2, 00,000 gallons of crude oil was spilled in the Alaskan tundra. The pipelines of BP was responsible for this particular act, the investigation that later took place, proved that the company had not gone by the rules and the laws of United States (Horowitz 2014). The law states that pipelines should go through regular and proper inspection as well as cleaning process. Thus, these two incidents proved that the organization had failed in taking ethical decisions; and the BP executives had been blamed for that particular reason.

The two big incidents or accidents could not bring in any big changes in the organizational structure of BP (Boopathy, Shields and Nunna 2012). The internal and the external regulations encouraged the risk taking as well as the cost cutting measures taken by the organization. The management philosophy too encouraged the cost cutting and the risk taking measures adopted by the organization (Michel, Owens, Zengel, Graham, Nixon, Allard, Holton, Reimer, Lamarche, White. and Rutherford 2013).

The scholars and the researchers believe that the incident violated the theory of Utilitarianism. According to this ethical theory of John Stuart Mill, greatest utility is there, only if large number of people are happy with the action. Mill refers that an action could be called the “best action” if it results in the maximization of the happiness of the greatest number of people. Mill is of the opinion that if to bring happiness for the mass, if one person has to sacrifice his/her life then that is acceptable as well. Therefore, if one follows Mill’s utilitarian philosophy then one can say that BP oil spill incident does not go by this particular theory (Arnold, Beauchamp and Bowie 2012). Rather this incident or explosion is very against the Mill’s utilitarian theory because it had not only polluted the environment, but had caused death of the human beings at the same time.

Philanthropic Action of BP: Moral or Immoral?

The particular accident or the explosion would never be supported by the Deontology theory by Emanuel Kant. According to Kant if a person has moral intention, then the consequences of the actions that are being made by him/her should not be given importance (Bentham 2014). The particular theory emphasis on the moral intention of the action, the moral consequences of the actions are not given much importance. Therefore, the BP oil spill accident does not fall this particular ethical theory at the same time. The multinational petroleum company, carried on with their action because of two definite purposes. One is high production and the second is cost cutting. Thus, the organization did not have any moral intention; rather they had a profitable intention in their mind (O’Sullivan, Smith and Esposito 2012). 

According to few scholars and the critics the action of British Petroleum that caused the major oil spill in the Gulf Mexico, is neither moral nor is it immoral. According to these few critics, the organization did not have any intention to dig the well inside the ocean. The organization also did not want to blow the wellhead; everything that happened was an accident (Liska 2013). Therefore, it can be said the actions that were carried out without any intention of causing any harm to the society or to the environment. Thus, it can be said that it is neither moral nor is it immoral.

The critics are of the opinion that if the ethical theory of Kant is followed for this particular incident then this particular incident has certain morality or ethics related to it. The critics believe that after the incident took place BP carried out few philanthropic actions. The philanthropic actions that are being carried out by the organization proved that the company had certain good intentions. Therefore, they are following these good intentions and carrying out the philanthropic tasks (Mayes, Bracey, Aguilar and Allen 2015). Thus, the actions or their thoughts could be considered as moral, going by the Kant’s definition of Deontology theory.

The particular philanthropic or the “clean-up” method that has been adopted by BP is not considered as moral or immoral according to many other critics or scholars. The other critics and the scholars believe that BP carried out the “clean-up” action to gain their lost reputation. Therefore, they had used the human beings as a means to come to a possible end, which will help them to get back their reputation (Beever and Hess 2016).

Conclusion

It is true that with respect to Kant’s Deontology theory critics and scholars have difference in their opinion. They, although, believed that only Kant’s theory could provide possible ethical solution to this problems. According to them, since the organization did not have any negative intention of blowing the wellhead therefore, it should not be considered as either moral or immoral. The others believe that Mill’s theory of utilitarianism could not be used in this particular case because here Mill had talked about the action of only one person. Therefore, the action of BP should not be judged with respect to the utilitarian theory, because here the actions are the result of the action carried out by a collective group of people.

Conclusion

Thus, the ethical issues that are related to BP oil spilling incident or accident is debatable. Many people feel that the actions are immoral, while other feels that they are neither moral nor they are immoral. Therefore, the debate continues, although the particular incidents have changed the lives of many living beings. The dolphins, living in the coast of Gulf of Mexico are the worst sufferer of all.

The incident although, warned the US government and they became alert and today the independent companies are careful about the risk management issues that are related to it. The other issues that came to the forefront with this particular incident include the lack of training program that is being provided to the employees. The ignorance towards the health and the safety measures that are being laid by the government of the United States. The particular incident made aware of these facts and the government more concern. They became more careful, when it came to regulating the energy producing companies like British Petroleum. 

References

Arnold, D.G., Beauchamp, T.L. and Bowie, N., 2012. Ethical theory and business. Pearson Higher Ed.

Beever, J. and Hess, J.L., 2016. Deepwater Horizon Oil Spill: An Ethics Case Study in Environmental Engi-neering.

Bentham, J., 2014. Deontology; or, The Science of Morality.: In two volumes. Adegi Graphics LLC.

Bond, D., 2013. Governing disaster: the political life of the environment during the BP oil spill. Cultural anthropology, 28(4), pp.694-715.

Boopathy, R., Shields, S. and Nunna, S., 2012. Biodegradation of crude oil from the BP oil spill in the marsh sediments of southeast Louisiana, USA. Applied biochemistry and biotechnology, 167(6), pp.1560-1568.

Brennan, L.C., 2013. Gulf Oil Spill. ABDO Publishing Company.

Horowitz, A., 2014. The BP oil spill and the end of empire, Louisiana. Southern Cultures, 20(3), pp.6-23.

Issacharoff, S. and Rave, D.T., 2013. The BP Oil Spill Settlement and the Paradox of Public Litigation.

Liska, A., 2013. Ethics & Engineering.

Mayes, R.J., Bracey, P.S., Aguilar, M.G. and Allen, J.M., 2015. Identifying Corporate Social Responsibility (CSR) Curricula of Leading US Executive MBA Programs. Handbook of Research on Business Ethics and Corporate Responsibilities, pp.179-195.

Michel, J., Owens, E.H., Zengel, S., Graham, A., Nixon, Z., Allard, T., Holton, W., Reimer, P.D., Lamarche, A., White, M. and Rutherford, N., 2013. Extent and degree of shoreline oiling: Deepwater Horizon oil spill, Gulf of Mexico, USA. PloS one, 8(6), p.e65087.

O’Sullivan, P., Smith, M. and Esposito, M. eds., 2012. Business ethics: a critical approach: integrating ethics across the business world. Routledge.

Ritchie, B.W., Crotts, J.C., Zehrer, A. and Volsky, G.T., 2013. Understanding the effects of a tourism crisis: the impact of the BP oil spill on regional lodging demand. Journal of Travel Research, p.0047287513482775.