Categories: Big oil / Crisis management / Energy issues

12 May 2010


Risk free energy? Boycott BP? No way!

At the Senate hearing into the Gulf of Mexico oil spill BP, Transocean and Halliburton disputed each other’s account of what caused the accident. It was a messy affair. But in it I glimpsed the makings of a much-needed corrective PR campaign.

As the three companies faced their interrogators, behind sat protesters wearing T-shirts embossed “Energy shouldn’t cost lives”. When the proceedings closed the protesters screamed at the BP spokesman, “Hey, Hey, Lamar MacKay, how many fish did you kill today?” They chanted “Boycott BP”. They seemed to have friends in the Senate. Bob Menendez, the Democratic senator from New Jersey said:

“We were told that the Titanic was so technologically advanced that it couldn’t sink, and we were told that this well was so technologically advanced that it couldn’t spill. Unfortunately both of these technological marvels ended in tragedy.”

Actually, nobody ever said that either accident couldn’t happen. Though the makers of the Titanic and BP both at some point understated the potential risk involved in their respective challenges. That’s all the more reason, I believe, for BP to use this latest incident to set the record straight with the public about the realities of its business.

But right now the White House has vowed to “keep a boot to the throat” of BP. That’s an understandable response while the oil flows unchecked from the seabed. That does not mean that either PRs or BP should see it that way.

However, PR dogma suggests that BP should bite its tongue. The PR rulebook, designed to maintain a licence to operate, opines that if people think BP’s the villain it should act like one. Larry Smith of the Institute for Crisis Management and Timothy Coombs of Eastern Illinois University advocated this viewpoint to Slate:

[It’s] literally true: BP owns the oil but not the rig. But it’s a shoddy communications strategy, says Smith. Wherever the fault lies, BP shouldn’t be splitting hairs. Companies should take the fall and work out recriminations behind closed doors, says Coombs. For example, when the chain Taco Johns had an E. coli outbreak, it didn’t publicly blame the lettuce supplier. It took responsibility. And, of course, sued the lettuce supplier later.

Effectively, Coombs is arguing that BP should adopt a cynical strategy in which it says one thing in private and another in public. His logic – and that of most PRs – is that the truth is too nuanced and complex for the public to comprehend. The argument goes that perception is everything. As the WSJ explained, they’ve got a point:

When you consider that analysts’ worst case scenarios put the eventual cost to BP at around $8 billion, yet $30 billion has been wiped off the company’s market capitalization since the crisis began, it becomes clear that this reputational damage has a value.

The problem is that by accepting full responsibility for the accident, BP would promote itself (dishonestly) as incompetent. How would that help maintain its credibility and reputation? Hence, I much prefer BP chief executive Tony Hayward’s strategy of accepting full responsibility for cleaning up the mess caused by its oil, while quietly but firmly disputing that it caused or was responsible for the accident. But Malcolm Gooderham, MD, TLG Communications, dubbed Hayward’s approach a “Miss” in PR Week. He also contrasted Hayward’s stance to that of his predecessor, Lord Browne:

“The virtue of Browne’s tenure was that despite the disasters, he is revered because of his strategic achievements. The challenge for BP today is to define a new thought leadership agenda.”

Browne’s thought leadership led him to re-brand British Petroleum as Beyond Petroleum. It was deceptive positioning and slightly bonkers to boot. To his credit, when Hayward took control of BP, he quietly downgraded the tag-line’s prominence. It now merely serves as “shorthand for what we do”, which is petroleum, and it hardly features at all in BP’s PR. What’s more, the irony of BP’s current plight is that it follows Mr Hayward’s determination to re-oritentate itself on technological competence rather than geo-political flair.

So what’s my advice to BP today?

  • BP should concentrate on proving itself committed and competent as it cleans up the mess and reconsiders safety strategies
  • BP has to speak with one voice in public and in private, now and in the future
  • BP should use this crisis to educate the media, public and political elite about the realities of complex accountability
  • BP should seek to lay the blame wherever the facts take them, even if some more of it falls on them
  • BP should remind the world that energy is bottled force; BP is as good as any in handling the hazards involved in fueling our world
  • BP should state the Browne years of Texas and Alaska lapses are behind them and what happened in the Gulf of Mexico was not caused by the same internal flaws
  • BP needs to stress that the oil that’s now being drilled is located in inhospitable conditions and has inescapable risks
  • BP should repeat and repeat that whatever lessons can be learned will be learned and that no stone will be left unturned in discovering them.

5 responses to “Risk free energy? Boycott BP? No way!”

  1. Heather Yaxley says:

    Paul – I feel we are in an era for a new approach to crisis management. But unfortunately as you say the PR crisis handling dogma has got stuck in a groove that does not reflect the complexity of the modern world.

    There is no one way to handle a crisis and promoting the apologia route is not only disingenuous, but positions PR advisers as capable of providing simplistic solutions to complicated communications (and management issues). However, this is the high revenue end of PR consultancy – and with the lawyers also increasingly providing PR counsel in this territory, who is going to admit that things aren’t as much under our control as clients wish to believe.

    I agree with you that there are plenty of occasions where confession and acceptance of responsibility is inappropriate – not least because the mud then sticks where it shouldn’t.

    The point you make about education of media, public and political elite about the realities of complex accountability needs expanding into education about risk. Of course, needless risk is unacceptable, but if we think we can only make decisions that are risk free, we’re on a very dull road to nowhere.

    Firstly, innovation is about risk – and if we are to address many of the issues that affect the world (many of which cause campaigners to use PR themselves), we need bold endeavours.

    Secondly, life is about risk – and people need to understand that it drives human behaviour and makes us feel alive to take chances where if things go wrong, there are serious consequences.

    Thirdly, risk is something to be understood not eliminated. Take the Toyota recall scenario – even if we accept the claimed accidents as causally related to a technical problem (and that’s a big IF in my book), then the risk of such an accident is much less than many other routine activities in everyday life.

    Society does need to keep a check on recklessness – but also needs to understand that errors and any resulting crisis, are inevitable.

    One final point – I’m bemused by the fact that we’re constantly told the money men are risk takers when they are consistently the ones who wobble at the slightest crisis.

  2. Tony Coll says:

    My take is that Corporate Social Responsibility has made a difference to crisis management. In the past, the PR response to a disaster was often a knee-jerk ‘it wasn’t us! and appearance was everything. And you’re right, the crisis was always seen as external. So you would get crocodile tears and carefully-worded sympathy for victims, but no admission or acceptance of responsibility.

    CSR builds an ethical strand into corporate thinking, and part of that is honesty and openness. This changes the role of PR from ‘spin’ – which is about hiding or nuancing the truth – to genuine information, irrespective of whether the corporation is at fault, or even contributing journalistically to the discovery of what happened. Obviously, accidents will happen despite the best intentions, and the best, most honest and open reaction is ‘break your own bad news first’.

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  4. Larry Smith says:

    I’m afraid you did not make my point clear in referring to my comments in the Slate.Com article. I agree with much of what you say, but I am NOT advocating that BP say one thing in public and do something else in private. That would be deceitful and suicidal. I do feel strongly that BP is not doing itself any favors by “pointing fingers.” That may be approriate at some point, but right now the regulators, legislators, consumers and public want honest, straight-forward answers and to know that the companies and agencies involved are taking the appropriate responsibility for their actions and are working to solve the immediate problems.
    And Heather, I beg to differ about your so-called PR dogma….the principles of good crisis management haven’t changed…some of the tools and technology have….but the most basic element of crisis management is the “prevention” of crises. On average, over the past 20 years, two-thirds of all crises could have been prevented and this one probably could have been prevented, too.

  5. Paul Seaman says:

    Larry, I erred. It was Timothy Coombs from Eastern Illinois University who actually suggested BP should do one thing in public, which is accept, or imply that it accepts, the full blame now, while saying something different in private or in court later on. However, we remain divided on a key point. I believe that honest straightforward answers should include BP saying that it accepts responsibility for the clean up while it disputes, for lack of evidence, calls for it to take the rap for the accident itself. In the media and at a Senate hearing that requires BP to give an account of the lines of accountability and to explain possible causes in that context. Moreover, I don’t think it will ever be possible to prevent every crisis that results from mankind’s risk taking because to err is human. Though I do agree with you that most crises can be avoided. Note: I tweaked the main text to correct by mistake.