Csr in British Petroleum and Exxon Mobil

Topics: Corporate social responsibility, ExxonMobil, Sustainability Pages: 27 (10063 words) Published: November 28, 2005
The energy sector is generally driven by the price of crude oil. Recent trends of reviving global economy, increasing demand for energy, and political turmoil in oil-producing regions, have seen oil prices soar (to more than $55 a barrel in 2004), thus causing industry rebound. Higher prices have reached most of the industry – producers, refiners, pipeline companies, equipment makers, oil field service providers, and gas station operators - which have all enjoyed new profits. Leading the charge are the world's largest integrated oil companies: Exxon Mobil, BP, and Royal Dutch/Shell (Yahoo Finance, Industry Profile). British Petroleum (BP) is of one of the world's largest energy companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemical products for everyday items. Incorporated in 1909 in Great Britain, BP has transformed from a local oil company into a global energy group with four main businesses: Exploration and Production; Gas, Power and Renewable; Refining and Marketing; and Petrochemicals. The Company employing over 100,000 people has established operations in Europe, the United States, Canada, South America, Australasia and parts of Africa. Exxon Mobil Corporation is engaged in the energy and petrochemical business. Through its divisions and affiliated companies, Exxon Mobil operates or markets products in the United States and approximately 200 other countries and territories. The Company's principal business is energy, involving exploration for, and production of, crude oil and natural gas, manufacture of petroleum products and transportation and sale of crude oil, natural gas and petroleum products. Exxon Mobil is also a manufacturer and marketer of basic petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics and a variety of specialty products. In addition, the Company has interests in electric power generation facilities.

1.1.CSR Challenges to the Sector
The issue of corporate social responsibility (CSR) – broadly defined to include such concepts as sustainability, sustainable development, and sustainable enterprise management – is now challenging the very foundations of the business strategies of the world's leading organisations (World Petroleum Congress). To many organisations, CSR serves as a guiding principle that strengthens corporate vision, strategy and decision-making; while to others, it represents a series of vital issues that must be managed in order for the company to maintain its "license to operate". According to Swanson, P. (2002), the focus in the oil sector is usually on impacts in the developing countries where oil is being produced. Often operating in less-developed and undemocratic regions, environmentally sensitive areas, and with huge industrial facilities producing toxic by products, the energy industries are high risk with regard to the ethical, social and environmental challenges encompassed by CSR. The challenges in the global oil and gas business arise mainly from the fact that: •More than 90 per cent of the world's reserves are located in the developing countries. •Successful development of the activities of such companies has a substantial economic impact on the host country – potentially a powerful lever for broad social and economic development, an attractive target for corruption, or disruptive social impact. •There is a significant environmental ‘footprint' – which impacts along the entire supply chain – with implications for resource use, fragile eco-systems and biodiversity, air and water quality, as well as waste, its treatment and recovery (World Petroleum Congress). •Civil society organizations now have the new forms of relatively cheap and effective communications at their disposal (Swanson, P. 2002). What they expose can be disturbing to the public in the home countries of these companies Companies in the petroleum and gas industry have pioneered...

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