British Petroleum Company - Assignment Example

Owners The owners are the shareholders of the firm contributing their capital i.e. funds to the firm in order to finance it. The owners of BP are itsshareholders who contribute their funds through purchase and sell of its shares on the stock exchange. Owners of the firm interact with other stakeholders and business of the firm through their board of directors and other supervisory mechanisms. Since owners/shareholders are not directly involved in the management of the firm therefore their interaction remains mostly in terms of supervisory oversight. (Post, Preston, & Sauter-Sachs, 2002) Their overall interests in the business include the extent to which they have invested their funds in the company. Shareholders and owners of BP have the major influence on other stakeholders and business. The cost cutting process may also be a direct result of their emphasis on reducing expenses so that profitability could be improved. The current situation of the owners/shareholders of BP suggests that the market value of their overall investment in BP has declined over the period of time. Managers Managers are the people who have been trusted with the responsibility of managing the day to day affairs of the firm. Managers of BP are persons responsible for ensuring that the manufacturing facilities at its exploration facility are in conducive form and do not pose any threat to the life of labors or others. Managers interact with the business on daily basis because managing the business is their day to day job. They also interact with other stakeholders through annual general meetings, board meetings as well as interacting with government agencies. The overall interest of the managers in business includes their jobs, compensation and rewards. The decisions of the managers directly affect the business and the managers as in this case. Managers decided to cost cut and reduce the expenses however; this has resulted into the significant risk issues for the firm. Managers of the firm are still working in BP because without managers, it would be difficult for BP to manage its day to day affairs. Employees Employees are the individuals who work for the organization against certain wages. Employees for BP are the people who work at its exploration facilities and were hurt in different incidents due to security and risk lapses. Employees interact with the business as a part of their day to day duty whereas they also interact with other stakeholders specially managers on daily basis. The interests of the employees in BP are limited to their compensation and rewards and retirement benefits. Employee can have significant influence on the business and stakeholders however they may not be decision makers in the firm. Since no organization can work without employees therefore employees continue to work for BP even after the incident of 2005. Business Partners Business partners of the firm are those firms or individuals who do business with the firm i.e. suppliers of raw material as well other material. Business partners of BP are American government, different other suppliers who have provided it resources to extract the oil from its Texas oilfield. Business partners interact most with the business as compared to other stakeholders because it’s the business to which they deal with. Their overall interests in the business are to the extent to the value of the raw materials and other goods and services provided by them to BP. They can influence the business and other stakeholders to the extent of their involvement in the overall affairs of the firms. In terms of safety and risk, business partners can only be limited to the installation and maintenance services provided by them. They may be influenced by other stakeholders of the firm specially the government and may also force the firm to upgrade their current old security infrastructure in order to reduce the chances of environmental damage. Business partners of the firm are not particularly affected by the 2005 situation however, US government, which has allowed BP to extract oil from its fields have significantly imposed penalties on it in order to ensure that BP develops its security and risk management infrastructure. The Local Community The local community comprises of the people and the resources which resides near to the manufacturing facilities of the firm. The local community of BP is Texas city and its people as a whole where the exploration facilities of BP are located Local community can interact with the business when business can offer some help in terms of corporate social responsibility. This may include developing local community’s infrastructure, donating to the schools and universities as well as providing employment to the local community. Local community can also interact with other stakeholders of the firm in an informal manner for ensuring that activities of the firm will not affect the local community. (Wheeler & Sillanpää, 1997) The overall interests of the local community in the business would include the extent to which business activities of the firm support the environment of the local community. Further, it will also include the community’s interests in having access to the funds available for development. It is also important to understand that community may also have interest in having a safe and secure environment which is conducive also. Local community can have significant influence not only on the business but on other stakeholder groups also. Local community can significantly influence the government to force the companies like BP to install and proper security and risk management apparatus in place. Local community still is wary of the situation with BP as BP has been involved in another oil spill in the Gulf of Mexico region. Environmental NGOs Environmental NGOs are the non- governmental organizations with an aim to achieve certain social objectives. Though case study does not particularly mention this stakeholder group however, environmental NGOs play significant role as the pressure and lobbying group to ensure that international organizations remain within their ethical boundaries. Environmental NGOs can interact with the business and with other stakeholders through either meetings or demonstration. Such organizations also use websites and seminars as the methods for interacting with different stakeholders specially local community to increase the awareness against the activities of the company. Since NGOs have the aim of achieving certain social goals therefore it is important for them to exert influence on the firms in terms of ensuring that they not only put in practice the effective and updated security infrastructure within the organization but also control the damage done to the environment. Issues such as oil leakages clearly pose threats to the environment and NGOs can therefore have significant interest in the way business operates. Environmental NGOs can work as the pressure groups therefore they can significantly influence other stakeholder groups. Due to their overall power and penetration within the society, environmental NGOs can actually force the firms to make changes which are conducive for the environment. Environmental NGOs are still active in ensuring that BP puts into practice different safety mechanisms in order to reduce the impact of its activities on the environment. Customers The end users or customers comprise of the group of stakeholders who directly purchase and consume the products of the company. Customers of BP are individuals and firms who purchase the oil explored and marketed by BP. Customers interact with the business through the buying and selling of BP’s products whereas they interact with other stakeholders through relatively informal manners. The key interests of the end users in the business are based upon the fact that BP provides them fuel and energy products. These products are than subsequently used to achieve other economic benefits. As such the overall interests of the end users are relatively large and can significantly influence the firm also through demand and supply dynamics. Customers can directly influence the firm and scan force it to implement and install the new and updated versions of its security and risk infrastructure. By refusing to purchase or linking their purchasing decisions with the ethical conduct of the firm, customers can significantly influence the way firms like BP operate and conduct its activities. Customers can also influence shareholders and managers as reduction in demand from customers could result into low profitability for the owners and lesser compensation and rewards for managers. Since that incident, customers have become relatively more ethical in their dealing with BP and are now weighing their purchases against the ethical conduct of the business and the impact of its activities on the environment. Bibliography Post, J. E., Preston, L. E., & Sauter-Sachs, S. (2002). Redefining the corporation: stakeholder management and organizational wealth. Boston: Stanford University Press. Wheeler, D., & Sillanpää, M. (1997). The stakeholder corporation:a blueprint for maximizing stakeholder value. New York: Pitman. Read More