April 20 will always be an unforgettable date in my mind. On this day, the Bulgarians rose against the Ottoman Empire to liberate themselves from its tyranny; Adolf Hitler was born; a friend of mine from high school was born; and now a massive explosion at the Gulf of Mexico killed 11 people, caused and is still causing panic as the quantity of millions of barrels of oil have been spilled in the ocean so far and keep spilling causing a natural catastrophe and depriving fishermen and shrimpers from conducting their businesses there.
The oil spill even changed some Americans’ view on drilling in currently protected areas off-shore, as the most recent national survey conducted by the Qunnipiac Poll suggested. Compared to two years ago, 53 percent of the American people support drilling in currently protected areas off-shore – a 9-percent decline – while 40 percent are now against it, or up by 8 percent.
Who is responsible for the disaster?
There is a general consensus that British Petroleum (BP) and TransOcean are responsible for the disaster on the following main grounds, among other things:
they are conducting the drilling there
they have objected regulations proposed by the Minerals and Management Service (MMS), a federal agency that oversees off-shore drilling
BP didn’t listen to their own plan review and subcontractor Halliburton regarding the well’s design, the casing option and the cementing job in a general effort to cut costs. In other words, BP did the exact opposite of what its CEO Tony Hayward promised when he became the company’s chief executive – put safety first. Apparently BP chose to put cutting costs first and safety second
BP disregarded their own data that shows subsurface plumes and lied that there were no subsurface plumes in the Gulf of Mexico
BP didn’t listen to subcontractor Halliburton using merely six and not 21 centralizers to make sure the casing ran down the center of the well bore
- Went against the advice of its own plan review regarding the well’s design and chose a riskier, cheaper and quicker casing option
- Used only six centralisers to make sure the casing ran down the centre of the well bore, rather than the 21 recommended by sub-contractor Halliburton
- Rejected warnings by its own plan review and Halliburton in preparations for a cementing job
- Decided to forego a recommended safety step in the circulation of drilling mud
- Did not deploy a “lockdown sleeve” that would have prevented the seal from being blown out from below
These are just parts of the whole picture that proves BP’s responsibility in the longtime disaster.
The corporate politician
Politicians are generally not liked for numerous reasons. Through their policy decision making, whether in the form of approving of a legislation or choosing their allies, they are either suffocating businesses or are suffocating the people, or the other way around. One other thing that people generally dislike in most politicians is their ability to tell the public what the latter wants to hear and never deliver or talking a lot without having said anything at all or having reassured the people.
However, as I watched a great deal of the U.S. House of Representatives’ Energy and Commerce Committee hearing that was then doing their investigation on the matter with BP’s Chief Executive Officer (CEO) and member of the company’s Board of Directors Tony Hayward, I couldn’t help but notice that there is a dramatic resemblance between a politician – whether elected by the people or appointed by the executive or legislative branch – and a CEO. During the hearing, Mr. Hayward, despite the fact that the members of the committee had allegedly given him enough time to prepare himself for the questions to be raised especially for the hearing, acted like a politician evading from answering questions specifically or saying that “I was not part of the decision making” process regarding the Gulf of Mexico. In fact, he was specific in not more than 2-3 not very important questions. Moreover, that corporate politician had promised that “safety was going to be my top priority I’d focus on like a laser” (from the hearing), while, as the committee members noted this article during their investigation, he was committed to trimming “fat and bureaucracy” in the company because “assurance is killing us.” It appears that not safety but maximizing profits and minimizing costs were his top priority that he’d focus on like a laser.
Nothing surprising though
Tony Hayward’s conduct shouldn’t be surprising considering the way a company is being governed, and BP makes no difference in this regard. Just like any business entity that has shareholders, Board of Directors and corporate officers, the shareholders are the ones that elect the Board of Directors (3.4.2). Even if we disregard the fact that no businessman wants to selfincriminate, it is highly unlikely that Tony Hayward, a figure with authority in the company, would want to be voted out by the shareholders or forced to resign. After all, BP apparently has the practice of firing its own employees, unknown to the public, for whistleblowing that, if being listened to, would potentially increase its costs by several million dollars. And that’s contrary to what any entity would not want to do – increase its costs while not increasing revenue enough to neutralize them, thus not maximizing profits. Sad but true!