To What Extent is BP Guilty of Greenwashing - Literature review Example

To What Extent is BP Guilty of 'Greenwashing' The increasing preference, among consumers and the society at large, for products and companies with minimal adverse impact on the environment and world climate have cause more and more companies, essentially multinational firms to make false claims about the environmental impact of their products and activities. This phenomenon is known as 'Greenwashing'. According to an article from SourceWatch, "Greenwashing is a form of public relations propaganda which gives something the appearance of being environmentally friendly when it is, in fact, not" (BP's Rebranding, 2005). The Concise Oxford English Dictionary defines 'greenwashing' as "disinformation disseminated by an organization so as to present an environmentally responsible public image." It is argued that the presence of the word in the dictionary indicates the growing trend of this phenomenon among corporations. The trend of 'greenwashing' seems to be on the rise as oil companies, known to reap heavily from degradation of the soil, pollution of the air and global warming, realise that they have to re-present themselves as partners towards global climate solutions, manufacturers of automobiles, jets and airplanes realise they can launder their image even as they promote their products and companies in all industries realise the importance of presenting their activities and products as climate-friendly, to make socially conscious investors and consumers more comfortable with buying their products. In most cases, the 'green' propaganda is also aimed at achieving an unfair advantage over competitors (BP's Rebranding,2005). Deen (2002) reports that the wave of 'greenwashing' began more than a decade and half back, in 1990, when on 'Earth Day millions of people across the world gathered to protest the declining health of the planet. This made it glaringly clear to the several multinational corporations that the average human had started to take interest in the wellbeing of his environment. British Petroleum (BP) is a global oil and gas company that has its headquarters in London. As at 2003, the company reportedly had over $233 billion in revenues, oil and gas exploration projects in 26 countries, with production plants in 23 countries and over 27,800 petrol stations. The company also owns 23 refineries and 32 chemical manufacturing plants around the world (BP's Rebranding, 2005). In mid 2000, BP launched one of the most expensive public relations and advertising campaign in recent times, re-presenting the company as an environmental-friendly one and introducing a new slogan 'Beyond Petroleum'. In line with the campaign, the chief of the company was quoted as saying; "The time to consider the policy dimensions of climate change is not when the link between greenhouse gases and climate change is conclusively proven, but when the possibility cannot be discounted and is taken seriously by the society of which we are part. We in BP have reached that point". During the course of the campaign, BP touted itself as the global leader in producing the cleanest burning fossil fuel, first company to introduce cleaner burning fuels to many of the world's most polluted cities and the largest producer of solar energy in the world (BP's Rebranding, 2005). Also, Manuel (1999) argues that lofty slogans like "the first step is to acknowledge the impact we have on the environment. The next step is to do something about it" that can be found all through the BP's publications and website paints an image that looks more like that of an environmental organisation as against that of an oil company (Manuel, 1999, p.6). With such moves and statements, BP sought to distinguish itself as one oil company that is different from all others. According to the article from Sourcewatch, this attempt is not only to distinguish BP as an oil company from it's more notorious European counterparts, but also the aggressive American oil companies like Exxon Mobil and the likes. This was concisely conveyed in the statement of Anna Catalano, the Group Vice President for marketing, who, according to the Sourcewatch article told the New York Times that BP is "the company that goes beyond what you expect from an oil company; frank, open, honest and unapologetic." (BP's Rebranding, 2005). However, when one looks beyond such oratory and take a cursory look at BP's environmental track record and activities, the unforgivable greenwashing that has been taking place becomes apparent. Demonstrating BP's profound greenwashing, the U.S. Public Interest Research Group (PIRG) in a report titled 'Mixed Messages' stated that on the same day that BP launched it's new advertising campaign, adopting the green and yellow sun as its logo and introducing the new slogan - 'beyond petroleum', it was fined and agreed to pay $10million in penalties for environmental violations at operations throughout the United States (Mixed Messages, 2003, p.2). Such paradox is almost unforgivable. To further highlight the gap between what the BP preaches and what obtains in its operations globally, the report indicated several instances of BP's unethical operations and fines and/or law cases it had faced due to such operational conducts. Among the numerous conducts highlighted are: On September 1999, BP pleaded guilty to US federal charges connected to the illegal dumping of hazardous waste into the groundwater at the Endicott Oil Field. As part of settlement of the case, BP agreed to pay $22 million in criminal and civil penalties and was put on criminal probation. Of this amount, $15 million was meant for environmental management systems at BP facilities in the United States and the Gulf of Mexico, $6.5 million to settle civil claims related to the illegal dumping and a maximum criminal fine of $500,000 for violating federal safe drinking water laws. In April 2001, BP was fined $412,500 for failure to safely monitor waste discharges from several of its North Slope operations. Due to BP's voluntary disclosure of Clean Water Act Violations, the fine was later reduced to $53,460 Despite its touted environmental friendliness, BP did not replace a faulty valve at a Prudhoe Bay oil well until September 2002, nearly four years after employees at the oil well requested that the valve be replaced to mitigate against possible oil spills BP refused to install an advanced system that could detect pipeline leakage throughout the Prudhoe Bay facility and was fined $300,000 in May 2002 for the negligence. In August 2002, an explosion at a North Slope well pad severely injured an employee who suffered severe burns and broken bones. In November of that year, BP agreed to pay the state of Alaska $675,000 for costs related to the cleanup of a large Prudhoe Bay pipeline spill, while in the December of the same year, a BP employee was killed due to a water pipeline burst under extreme pressure on the North Slope. In May of 2003, a spill of more than 6,000 gallons was discovered at an underground pipeline near a caribou crossing on the North Slope and the cause of the spill was determined to be pipeline corrosion. Despite all these, BP still continues, till the present day, with its 'beyond petroleum' public relations with messages like, "no accidents, no harm to people, no damage to the environment" displayed on billboards and websites. One wonders how far BP would go with such misleading propaganda(Manuel, 1999, p.6-8; Mixed Messages, 2003, p.2-3). As if these were not enough deceptions, the Sourcewatch article reported that although BP has carved a niche for itself in public opinions as one of the major supporters of the Kyoto protocol, the treaty by nations to regulate and control the emission of greenhouse gases, it was discovered in May 2002 by the Greenpeace organisation in New Zealand that BP was an active member of a New Zealand Coalition lobbying the government not to ratify the convention (BP's Rebranding, 2005). Besides this fact, Manuel (1999), reports that BP is one of the biggest contributors to climate change and that its acquisition of ARCO increased its production of carbon based fuels to 3% of the world's total fossil fuel emissions, making BP the fourth largest carbon producer in the world (Manuel, 1999, p.8). Also, while noting BP's claims to the largest producer of solar energy, over-hyped as "starting a journey that will take a world's expectations of energy beyond what anyone can see today", in some of BP's public relation campaigns, Manuel (1999) argue that more 'greenwashing' becomes apparent when one compares the budget for Solarex (the solar energy company), with the budget for the merger with ARCO. This was clearly stated in the Sourcewatch article's statement credited to Kenny Bruno, a researcher for CorpWatch that though, BP could make claims to being the world's largest solar energy producer, however, this was achieved by spending $45 million in 1999 to buy Solarex which pales when compared to the $26.5 billion it spent to buy ARCO to expand its oil portfolio (BP's Rebranding, 2005). Further dissecting BP's claim, Manuel (1999) explain that almost hundred percent (and 99.5% to be precise) of BP's investments are still in fossil fuels, with its solar energy investment falling to an incredible 0.01% of the overall company's portfolio. He went further to highlight that for every $10,000 BP spent on oil exploration and development, only a disappointing $16 is spent on solar energy. However, BP has gotten itself a lot of greenwashing bang for that 0.01% investment (Manuel, 1999, p.9). BP's travails and greenwashing seem to be unending. BP's touted 'sound business ethics' in the wake of the company's rebranding have also been seriously challenged. For instance, in June 2001, The Sunday Times of London reported that both BP and Shell conceded that they hired the services of a private intelligence company with close ties to the British spy agency, MI6, to collect information on campaigns by Greenpeace and the Body Shop. Again, the greenwashing of BP came to limelight in 2003 when a Californian air quality regulatory agency sued it for $319 million over what it alleged were thousands of violations of emissions standards at its Carson oil refinery in the port of Los Angeles. BP was also reported to be a member of trade associations that have been pressing to weaken corporate governance standards and have been accused of human right abuses in countries like Colombia, where its Casanare oil field has oil reserves valued at approximately $ 40 billion and in Iraq. Despite its huge spending on the 'beyond petroleum' public relation campaigns to position itself as an environmental friendly company, 'the Independent' of June 2005 reported that BP "has been privately lobbying in Washington to block legislation to introduce a mandatory curb on greenhouse gases in the U.S." It has also backed the US Bush's government attempt to open up the Arctic National Wildlife Refuge in Alaska, the only US Arctic that has not been sacrificed to oil exploration, to oil drilling. BP has also been reported to continually drill for oil in environmentally sensitive areas, such as the Atlantic Frontier (BP's Rebranding, 2005). Business and marketing are human conducts and transactions, as a result, they are activities that must be grounded on and guided by strong moral principles and ethics (England, 2005). Honesty, fairness and integrity are key marketing ethics that should not be compromised. It is of paramount importance that manufacturers, companies and industries are honest about their products and activities as it affect the consumers; the consumers have the right to knowledge of the product they are being supplied with. Fairness and integrity demands that companies and business be sincere with the impacts of their activities and products on the society and the consumers. Several philosophical theories propounded in the search for what best explain human conducts and actions. Two of such theories that we shall examine in this respect are the Positivism and Utilitarianism theories. Positivism is a philosophical school of thought that holds that the goal of knowledge is simply to describe the phenomena that we experience. That science should simply to stick to what we can observe and measure. Knowledge of anything beyond that, a positivist would hold, is impossible (Trochim, 2005). In a broad sense, positivism is described as an antimetaphysical and antireligious approach to the search for knowledge. The Encyclopdia Britannica described Positivism as a philosophy of science so narrow that it denied any validity whatsoever to "knowledge" not derived through the accepted methods of science (philosophy, history of, 2006). The main thrust of the positivist approach to knowledge was the believe in empiricism; the idea that observation and measurement was the core of any scientific endeavour. Therefore, in the positivist view, the world and the universe were deterministic and operated by laws of cause and effect that we could discern if we applied the unique approach of the scientific method. So, science was seen as the way to get at truth, to understand the world well enough so that we might predict and control it (philosophy, history of, 2006; Trochim, 2005). Utilitarianism: This school of thought can be attributed to the works of the English philosophers and economists Jeremy Bentham and John Stuart Mill that posited that an action is right if it tends to promote happiness and wrong if it tends to produce the reverse of happiness. This happiness promoted by action must not be to the performer of the action alone, but to everyone involved and affected by such action (West, 2006). Utilitarianism can be seen as an attempt at answering the question "What ought a man to do" The answer to this question, from the Utilitarian view point is that a man ought to act so as to produce the best consequences possible. This would be seen to be in sharp contrast to the positivist viewpoint, which does beliefs only in physical reality and discountenanced such emotional matters like what a man thinks or acts. Consequences of an action, to the Utilitarian, includes all the good and bad produced by action, irrespective of whether it happened when the action was performed or after it has been performed. However, in determining the consequences of action, Utilitarianism relies upon some theory of intrinsic value; something is held to be good in itself, apart from further consequences, and all other values are believed to derive their worth from their relation to this intrinsic good as a means to an end (West, 2006). In conclusion, it may appears unfair that BP is the target of environmental and social responsibility movements, especially, when one looks at the records of companies like Exxon Mobil, which attempts to stimulate public disregard towards global warming theories and still refuses to pay $5billion in punitive charges levelled against it by an Alaska court since after the 1989 Valdez oil spill, however, the bottom line is that BP, by the virtue of its actions and slogans have sought to distinguish itself as an oil company that is not like others and thus have created what appears to be a moral high grounds, it should, therefore, live up to this standard or sit in the ranks of other oil companies. References BP's Rebranding as a 'Green' Company (Online). Sourcewatch. Retrieved 8th May 2006 from Darcy Frey (2002). How Green Is BP New York Times, 8th Dec 2002 Edition. Retrieved online 8th May 2006 from Deen, Shireen (2002). Don't Be Fooled: America's Ten Worst Greenwashers. Retrieved online 8th May 2006 from England, Lizabeth (Online). Marketing With A Conscience: Sales and Ethics. U.S. State Department English Language Programs, Business Ethics Volume; Chapter 10. Retrieved Online 8th May 2006 from Hershey H. Friedman (2000). Biblical Foundations of Business Ethics. Journal of Markets and Morality, Volume 3, Number 1 Manuel, Athan (1999). Green Words, Dirty Deeds: A PIRG Expose of BP Amoco's Greenwashing. U.S. Public Interest Research Group Education Fund (US PIRG), Washington D.C. < http://www.pirg.org > Mixed Messages: BP's record on the environment and safety, Alaska oil operations, and the Arctic National Wildlife refuge (2003). U.S. PIRG Education Fund. Retrieved online 8th May 2006 from Philosophy, history of. (2006). Encyclopdia Britannica. Retrieved May 13, 2006, from Encyclopdia Britannica Premium Service. http://www.britannica.com/eb/article-8873 Trochim , William M.K (2002). Positivism & Post-Positivism. the Research Methods Knowledge Base. Updated Jan. 2005. Assessed 12th may 2006. Available online at West, Henry R (Online). Utilitarianism. Retrieved 13th May 2006 from Read More