Corporate Social Responsibility Strategies Definition
BP, which stands for British Petroleum, is a international gas and oil company that serves in nearly 90 countries (Reuters, 2012). BP is a considerably big corporation with 79000 employees worldwide, 22100 retail sites and produces more than 1.7 million barrels of refinery throughputs every day (BP at a Glance, 2105). Beyond any doubt, such a global company should have a well-structured corporate social responsibility strategy, as they have a role in the societies of nearly 90 countries, in order to act responsibly in the society and to deal with the suppliers and the customers of the company in a fair way. This paper undergoes the analysis current existing corporate social responsibility strategy of BP, secondly, the recommendations in order to improve the CSR strategy of the company and lastly mention the corporate social responsibility strategies recommended to BP based on the articles and researches of the scholars.
Corporate Social Responsibility Strategies Essay
The key points to successful corporate social responsibility strategies for the companies are stated by (Crane, Matten and Spence, 2014) as; voluntary, managing externalities, multiple stakeholder orientation, social and economic alignment, practices and values, beyond philanthropy. The writers claim that a well-structured corporate social responsibility project should meet these 6 elements. (Deneen, 2010) states that BP is having a “decade-old green marketing” and the company sums up their marketing strategy in two words with their slogan which is “Beyond Petroleum”. This slogan of the company gives the perception to their customers that they are carrying their business in an environmentally friendly way.
Corporate Social Responsibility Strategies BP
BP announced that since 2005, the company invested $4 billion in wind energy, solar energy, biofuels and carbon-capture-and-storage, which is a sign that the company is caring about the use of alternative energy sources (Deneen, 2010). The fact that BP is the only company that invests in all of these concepts shows that a petroleum company does not necessarily have to do it, thus BP is investing in alternative energy sources voluntarily. In this sense, BP satisfies the ‘voluntary’ element which is one of the six elements stated by (Andrew Crane, 2014). Apart from (Crane, Matten and Spence, 2014), eight assessment criteria for companies’ CSR strategy are given by (Smith, 2013) and the writer states the characteristics of a well-structured corporate social responsibility strategy as; unique, fit, stakeholder engagement, balance stakeholder interests, appropriate KPIs,well implemented,ambitious and realistic, legitimate.
The Corporate Social Responsibility Strategies of BP covers the balancing stakeholder interests and stakeholder engagement elements of the criteria of (Smith, 2013). According to (Deneen, 2010), BP aims sustainable development by adopting business strategies while satisfying the business and its stakeholders. In addition to this, the company is socially responsible and while using ships for carrying petroleum, they are telling their customers via advertisements that they are aware that the sea should stay clean while doing the shipments.
Even the corporate social responsibility strategy of the company seems to be well-structured, some additions to their strategy would increase both the profits of the company and the image of the company perceived by their customers. First of all, BP should work for eliminating the chances of environmental disasters by the aid of external stakholders. If BP uses this strategy they will increase the engagement of stakeholders and also they will become socially more responsible as stated by (Smith, 2013).
Engaging the stakeholders in figting with the disasters is both for the stakeholders and the BP company itself because having the stakeholders engaged in this strategy can help the company enter various disaster areas and they can increase the scope of their strategy which will make it more effective. In addition to stakeholders, the potential disaster areas may be identified and selected by the help of the officials of the local governments where BP operates. BP needs this support as the company operates in more than 90 different countries as stated above in this paper. Additively, since the company is in operating in a business that has a great potential to harm the environment, the company should focus on eliminating the possible negative impacts of their operations on the environment in different ways. Apart from stakeholder engagement, the company should be engaged in the programs and organizations about decreasing the environmental diseases.
CSR Strategies Essay
Company can do this by aiding these programs and organizations financially to support their research and implementation on potential environmental problems and researches. This seems to be a good idea for the company because starting an operation or research team for the environmental diseases may become a lot more complicated and costly compared to sponsoring the existing research projects and organizations. In this manner, the company can enhance the perceptions on how the company is socially responsible. Lastly, the company can do some improvements in recruiting by hiring people who has education about the environmental issues and who can contribute to the company about increasing the environmental responsibility of the company to become more adapted to the criteria stated by (Smith, 2013).
In addition to the current corporate social strategy of BP and the recommendations for improving the CSR strategy of BP, there are several theories about the CSR of the companies in the literature and these theories can be related with the CSR strategy of BP. The first theory is social entrepreneurship mentioned by (Kistruck & Beamish, 2010) which defines theory as “the relatively higher priority to promoting social value and development versus capturing economic value”. The theory’s main focus can be put in other words as improving the social value of the company and the perceptions on the social value.
The second theory is called ‘the triple bottom line’ which was coined by (Elkington, 1994) and says that ““responsible approach to business that should take into consideration environmental, social and economic dimensions of sustainable development”. So, the companies should have three bottom lines about people, profit and planet and the aim of the theory is to measure the financial, environmental and the social performance of the company. Having done a broad research, it may be stated that BP’s corporate social responsibility strategy is more related with the triple bottom line approach because of several operations, regulations and applications used by BP. In terms of the people element of the triple bottom line strategy, BP has a foundation called BP foundation for helping people, the company has an open talk global helpline and they have “direct spending” on people as stated in (Sustainability Report, 2014) published officially by BP.
Moving on to the planet element of the triple bottom line theory, BP has an operating risk committee, they work on their oil spill response and they work with Austrion Red Cross for disaster relief as stated in (Sustainability Report, 2014). Lastly, about the profit side of the triple bottom line, it is observed that Shell is having a dramatic decline in profits.
To conclude, according to the research done for this paper, BP has an acceptable company social responsibility strategy as the company shows they are caring about the environment by using the ways described above. Even the CSR strategy of the company is considerably good, the company may have some improvements in their CSR strategy in order to make their strategy well-structured. They can do this by caring about the environment by the aid of engagement of stakeholders, government officials and non-profit organizations. Lastly, applying the theories in the literature to BP, it is evident that triple bottom line is the most appropriate theory for BP with the people, profit and planet.
Andrew Crane, D. M. (2014). Corporate Social Responsibility.
BP at a Glance. (2105). BP Global: http://www.bp.com/en/global/corporate/about-bp/bp-at-a-glance.html
Deneen, S. (2010, Jun 11). BP before the oil spill: An environmentally friendly company? Daily Finance: taken from:http://www.dailyfinance.com/2010/06/11/bp-before-the-oil-spill-an-environmentally-friendly-company/
Reuters. (2012, February 02). 2012 Economic Outlook – Report Highlights BP plc (ADR) and Warner Chilcott Plc. Reuters: http://uk.reuters.com/article/idUS164994+02-Feb-2012+MW20120202
(2014). BP Sustainability Report.
Smith, N. C. (2003). Corporate social responsibility: whether or how? California Management Review, 45(4), 52-76.
Kistruck, G. M. & Beamish, P. W. (2010). The Interplay of Form, Structure, and Embeddedness in Social Intrapreneurship. Entrepreneurship Theory and Practice, 43(4), 735-761.