Social Performance of British Petroleum - Case Study Example

British Petroleum- Social Performance British Petroleum- Social Performance Background The need for corporate social responsibility has never been great after the onset of globalization. Stakeholders are individuals affected by the firm’s production and profit generation activities directly. The actions of British Petroleum has far reaching effects resulting in the company having a lot of stakeholders with the major stakeholders being employees, consumers, and investors who aid BP in achieving profitability, standardization, and social needs. This paper aims at expounding the stakeholders of British Petroleum and the influence of the stakeholders on the performance of British Petroleum. Citizenship is the place where a person or an organization claims residence. Global citizenship entails a firm having more one country of origin where a firm has a country of origin but with operations in global areas. The study will also study the concern and strategies associated with the formation of a group aimed at solving the concern generated by British Petroleum. The headquarters of British Petroleum are is in London, England with main operations in power energy and gas, liquefied natural gas, industrial lubricants, BP shipping and crudes, Asphalt and Bitumen, motor oil, and BP petrol stations. In essence, British Petroleum is a global company involved in power delivery to the consumers. Key factors in the external environment affecting the success of British Petroleum Two key factors in the external environment affect the ability of British Petroleum to meet the needs of stakeholders and the profitability of the firm. Government regulation is one of the factors since it determines the fee payments that have to be complied in new regions where British Petroleum expands (Timpere, 2008). Compliance to environmental regulation policies and payment of taxes in different areas is necessary for British Petroleum, and these are set by the governments through regulation affecting British Petroleum’s success. Investors are the second external stakeholders affecting British Petroleum’s performance owing to their part in the provision of funds for expansion and determine the economic development and profitability of British Petroleum. Funds from investors also aid in accessing new production areas for British Petroleum showing the high role of investors in British Petroleum’s success (Mishra & Suar, 2010). Salient Stakeholders in accordance to their roles and relationship with British Petroleum Customers- customers determine the ability of British Petroleum to makes sales depicting the influence they have in determining the companys success in meeting its objectives (Timpere, 2008). Customers are the main reason for the success of British Petroleum for the loyalty they provide for the company and determine the long-run survival of the company. Customers provide the means through which British Petroleum achieve its mission of ensuring consumers have the power in the different form offered by the company. Customers aid in achieving BP’s mission through purchasing products from the company determining sales and it for them that British Petroleum exists. Investors- purchasing British Petroleum’s security is a manner through which investors supply funds enabling British Petroleum to succeed (Mishra & Suar, 2010). Through good governance, investors have confidence in the performance and leadership of British Petroleum allowing it to access funds used in the implementation of British Petroleum’s projects and plans. Investors and British Petroleum have a relationship through investors providing funds for BP while BP ensures financial accountability; ensure good corporate governance, increasing revenues and payment of dividends to investors. Employees- productivity and success of an organization is tied to the employees, and this is the case at British Petroleum (Hunnicutt, 2009). Employees have the relationship to British Petroleum of generating output to fulfill the strategies and meet the objectives at BP. On the other hand, British Petroleum provides a safe working environment, fair remuneration and promotion, training, and career development for the employees motivating them to augment output and generate loyalty. Influence of primary stakeholders on the financial performance of British Petroleum Customers- the ability of British Petroleum to make profits, expand globally, and increase product offerings are dependent on the relation between British Petroleum and customers that has been good for a long time. Customers influence financial performance of British Petroleum because good customer relations allows BP to have loyal customers and gain referrals from satisfied clients resulting in augmented profits for the firm. This leads to the requirement of British Petroleum to have quality production aiding in meeting the BP’s stakeholder needs. Employees- employees provide a channel for the implementation of BP’s strategies, therefore, drive the main objectives of the company (Hunnicutt, 2009). Employee motivation ensures problem solving skills, good attitude towards the job, better job performance, and increases participation in decision-making aiding the achievement of expansion and profitability needs of British Petroleum translating to an influence on the financial performance of British Petroleum. Environment regulators- emission of poisonous gases and spills on the ocean make environment regulators a part of the stakeholders to the financial performance of British Petroleum (Timpere, 2008). Operation within environmental guidelines and being proactive in environmental conservation are measures that can aid in taking care of the environment. This will allow BP reach customers that purchase products from environmental friendly businesses. Environmental conservation also reduces costs from solving the environmental crisis, decreased production wastes, encourage employees to be environmental conservatism augmenting profitability hence have an impact on British Petroleum’s financial performance. Community- good relations and generation of a good image are the many results of participating in corporate social responsibility for British Petroleum (Mallin, 2009). Good relations with the community allow British American to hire workers from the community, achieve cash concessions through reduced taxes, and decrease in compliance requirements. These measures result in the positive impact on the financial position of British Petroleum due to reduced liabilities for the company and success in BP’s strategies and profitability. Suppliers- suppliers are important stakeholders to any business and acting in an ethical manner to suppliers by a firm ensures ability to access supplies on time and in required quantities (Mallin, 2009). Ethical actions to suppliers include timely payment, fair contract formation with suppliers, and child labor laws for suppliers. Timely delivery by suppliers occurs when there is ethical supplier treatment allowing British Petroleum to meet its goals and objectives increasing profitability and revenue for the business. Corporate responsibility concern associated with British Petroleum The 2011 oil spills in the Gulf of Mexico is the main corporate responsibility concern associated with British Petroleum. Different stakeholders were concerned with the oil spills and took different steps after the oil spill. Litigation process and payments, positions taken by the government and other regulators, the company’s measures after the oil spill are among the concerns that affected different stakeholder positions after the 2011 Mexico spill. The 2011 oil spill caused environmental challenges, destruction of economic challenges, and economic losses for the company showing the corporate responsibility concerns. Stakeholder group formation Environmentalists and individuals affected by the 2011 Gulf of Mexico oil spin are the influential stakeholders in CSR concerns at British Petroleum. Meeting of environmentalists in the Gulf of Mexico region who have a shared agenda of environmental conservation for the benefit of flora and fauna in the region for access to future generations is the plan to form a stakeholder group. This will result in the development of a better coexistence between firms operating in the region, environmental groups, and regulation authorities. To begin with, influential leaders in environmental groups will be conducted to seek their acceptance for membership in the stakeholder group to ensure that all environmental groups are represented. Secondly, written or mailed communication by interested individuals and organizations on their willingness to join the course will follow to allow a large amount of members willing to pay the price for better tomorrow. Forming the stakeholder concern group will allow overcoming the challenge as a group since the issue is of global concern and individuals alone may not be able to solve the problem. Harnessing supporting from the different individuals and environmentalists in the region will allow Gulf of Mexico coast protection. A stakeholder group increases the chances to access donor funding for environment conservation, allows for different ideas on how to solve environmental concerns in the region, and increase accountability of firms operating in the region. The group will also allow the concerns to reach the government for support compared to when individuals for the access to the goal of a well kept and cared for environment for all people in the region. Fostering collaboration in the group will be achieved through transparency in the carrying out of the activities of the stakeholder group ensuring all members are sure of the use of funds and are ready to offer the support for the leadership of the group. Having one goal for the group for the conservation of the environment will be the other measure taken to ensure collaboration in the stakeholder group. Further, financial accountability and information on the use of funds will augment collaboration in the stakeholder group through ensuring all members are informed on the use of funds and the plans of the group in meeting its objectives. Challenges to face the group and the measures to solve the issues Owing to the large geographical area, it will be hard for the group to come together and reach a common point on the measures to undertake to solve the problem. Communication challenges will also arise because of the large geographical area causing challenges for the members to physically meet and deliberate issues in a central location. Coming up with the same strategy to solve different challenges faced by the members of the stakeholder group from the oil spill, will make the other challenge that has to be overcome by the group. Members of the group may consider their individual needs as paramount and would want them solved, but the saving the Gulf Region is the main aim for the group for the betterment of all people. Another challenge that may impede the formation and success of the stakeholder group is the ability to know the members of the group will all have the best intention of the protection of the environment. Some of the members may be sent to sabotage the aims of the group through using inside information and act as spies for corporations in the region for personal reasons and benefits. Expansive geographical area is causing physical meeting challenge will be solved through using of the online platform to get varied views of members of the group. Avoidance of individual needs and supporting the course for the better of all will aid in solving the second problem of individualism and personal needs. Screening members to ensure spies and saboteurs are eliminated from the group allowing only members that have genuine concerns for the environment to allow for better environment conservation in the Gulf of Mexico region. In conclusion, British Petroleum participation in corporate social responsibility allows it to achieve profitability and success. Suppliers, customers, investors, community, environment regulators, and employees are the main stakeholders and impact on the financial performance of British Petroleum.References Hunnicutt, S. (2009). Corporate social responsibility. Detroit, MI: Greenhaven Press. Mallin, C. A. (2009). Corporate social responsibility: A case study approach. Cheltenham: Edward Elgar. Mishra, S. & Suar D. (2010). Does Corporate Social Responsibility Influence Firm Performance of Indian. Journal of Business Ethics. 95:571–601, Springer 2010. Timpere, A. R. (2008). Corporate social responsibility. New York: Nova Science Publishers. Read More