Corporate Social Responsibility

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Corporate Social Responsibility

• Energy Law Presentation
• Lois Kim Conor Weber
• Jeongloiskim_at_gmail.com Conor.weber_at_gmail.com

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Our Picture
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Summary of Presentation

1. History of Corporate Social Responsibility (CSR)
2. Current Status- Oil and Gas Companies
3. Praise and Criticism
4. Pros/Cons-the Debate
5. Conclusion and Recommendations

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1. History of CSR

• Concept
• corporate social responsibility- 1970s
• The inclusion of public interest into corporate
  decision-making
• The Triple Bottom Line
• People, planet, profit OR
• Economic progress, environmental progress, social
  progress

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History Cont.

• C. Shareholders vs. Stakeholders
• a. Shareholders own shares in an organization
• b. Stakeholders on whom an organizations
  activities have an impact
• D. Three Categories by the Economist
• a. Corporate philanthropy
• b. Risk management
• c. Win-Win

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History Cont.

• E. Other Approaches
• a. Philanthropy as a means of CSR
• b. The Community-based development approach
• c. Incorporate the Shared Value Model

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2. Current Status- Oil and Gas Companies

1. Shell
2. Chevron
3. BP
4. ExxonMobil

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A. Shell

• Background
• Created in 1907
• Largest energy company and second largest company
  
• 102,000 employees in more than 100 countries

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A. Shell

• b. Camisea-Peru
• i. First major foray into international CSR
  activities
• ii. Embracing the concept of sustainable
  development
• Tripod economic progress, environmental
  progress, and social progress
• iii. Rights to Explore
• Fields of natural gas in the Camisea

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A. Shell

• iv. Pledge standard of sustainable development
• Improving the quality of lifeand
• nonrenewable resources are used wisely future
  generations in mind.
• v. Contract and Smithsonian Survey
• A two-year contract in 1996 explore with minimal
  disturbance
• The Survey Emphasis on biodiversity
  sensitivity of the native people
• vi. Promise and Withdrawal
• vii. Disappointment

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A. Shell

• c. Nigeria
• i. Negative reception in Nigeria
• ii. Military government protection from Nigeria
• iii. Environmental issues
• iv. Amnesty Internationals criticism

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A. Shell

• d. Other Concerns
• i. Largest freshwater oil spill in 1999
• ii. Environmental record
• Disposal of the Brent Spar platform
• Reserved due to public pressure and commitment to
  sustainable development

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A. Shell

• e. Current
• i. Desire to be viewed as socially responsible
• ii. TV advertisements
• iii. Website initiatives
• Energy efficiency, fuel economy, technology,
  energy security, working with others, tackling
• putting its money where its mouth is

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A. Shell

• f. Searching for a Consensus
• i. Bittersweet history in Peru and Nigeria
• ii. Window dressing vs. evidence of improvement
• iii. Work in progress

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B. Chevron

• Background
• 1879 in California
• American multinational
• Approximately 67,000 employees worldwide

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B. Chevron

• b. Corporate Responsibility Management
• i. Public policy committee of the Board of
  Directors
• ii. Global Issues Committee
• iii. Vice President- policy, government and
  public affairs
• iv. Vice President- health, environment and
  safety
• v. Other managerial positions for specific areas

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B. Chevron

• c. What they do
• i. Reaching out to save lives
• ii. Learning about future energy
• iii. Introducing youth to science
• iv. Using energy efficiency
• v. Backs up feel good statements

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C. BP

• Background
• England
• Third largest energy company worldwide
• Fourth largest company

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C. BP

• b. Re-branding (beyond petroleum)
• i. Energy Challenge
• Deepwater exploration
• New technologies
• More from mature fields

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C. BP

• ii. Climate change and environment challenges
• Performance monitoring and developing efficient
  fuels and lubricants
• Promote natural gas
• Focus on remediation
• Tree planting in IL
• Advanced Seismic Imagery Technology

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C. BP

• Extended Horizontal Drilling
• New cleaning procedure for crude oil tank
• Water recycling plant
• New ways of making PTA
• Inclusion of cost of carbon in investment
  appraisals

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C. BP

• iii. Alternative energy
• Invest in low-carbon businesses
• Invest in renewables and carbon capture and
  storages
• iv. Safety issues
• Operating Management System (OMS)

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D. ExxonMobil

• Background
• American multinational
• One of the largest publicly traded companies in
  the world
• Worlds largest global refiner

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D. ExxonMobil

• b. Current- Taking on the worlds toughest
  energy challenges
• i. Environmental performance
• 2008 goals
• 2009 achievements

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D. ExxonMobil

• ii. Climate change
• 2008 goals
• 2009 achievements
• 2009 goals

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D. ExxonMobil

• iii. Human rights and security
• 2008 goals
• 2009 achievements

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D. ExxonMobil

• c. Searching for a Consensus
• i. Young company
• ii. Performance overview

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3. Praise and Criticism

• Companies
• Mixed reviews
• Difficulty in distinguish true motives
• Starting point

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3. Praise and Criticism

• B. The 2010 CSRI Index
• i. Boston Colleges Carroll School of Management
  and the Reputation Institute
• ii. Corporations strong interest in stakeholder
  opinion
• iii. Combined average
• 1. citizenship, governance and workplace

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3. Praise and Criticism

• C. Top 50 most socially responsible companies
• i. No oil and gas companies
• ii. The energy industry ranked the last in the
  perception of U.S. industries

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4. Pros/Cons-The Debate

• Q Is it in the nature of business to engage in
  CSR?
• C No. CSRs increase costs-gt less efficient
• P Yes. Social aspects of corporations
• C Posner-gt goal towards profits
• P Power of corporations

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4. The Debate

• Q Whose job is it to address environmental
  issues?
• P corporations are in a unique position to
  impact our environment
• C The government can enact changes to remedy
  environmental issues
• P inefficient and ineffective governments
• C spread the financial burden

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4. The Debate

• Q Are CSR initiatives necessarily costly?
• C Yes. New expenditure. Corporations should
  only look to stakeholder interest.
• P No. Customer loyalty, human resources
  objectives, risk management, brand
  differentiation, and the ability to attract
  investors

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4. The Debate

• Q Closing words
• C Give money back to shareholders. They can
  decide how to invest
• P Win-Win projects

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5. Conclusion and Recommendations

• Conclusion
• Companies are trying
• Hard to measure
• Need of improvement
• Recommendation
• Keep it up!

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The End

• Thank you!