Climate change is slipping down BP’s priority list
It seems BP now stands for “Back to Petroleum” rather than the ill-fated slogan “Beyond Petroleum”. Climate change no longer seems to be high on the oil giant’s agenda, based on the level to which BP’s Sustainability Review 2008 skips over green efforts to concentrate instead on day-to-day operational performance.
Given the safety issues and subsequent changes at the top that have troubled BP in recent years, the company’s clear desire to present itself as a safe and reliable pair of hands is understandable. Safety is undoubtedly a big issue for all those concerned, but climate change is also pretty important to BP’s stakeholders.
The printed review is just one aspect of BP’s comprehensive sustainability communications, which include group, country and site-level reports and the environment and society section of bp.com. Even more flexibility is provided by a pdf builder on the website that readers can use to customise the report.
The review begins with a clear and concise explanation of who it is for, what’s in it and why, and where to find more. Icons show when more is available online, and direct readers to additional information elsewhere in the review.
The tone is mostly friendly and straightforward, although some corporate-speak creeps into the strategy section and technical language is unavoidable in describing exploration and production. The glossary is a useful addition, explaining technical jargon hard to put into everyday English.
BP’s application of the Global Reporting Initiative guidelines shows how they can be sensibly used as a framework rather than a directive. The group has applied the materiality principle to exclude indicators that are not relevant to its business, while declaring an A+ application level. It’s also good to see examples of how BP has responded to feedback, such as restructuring the document and changing the way it reports emissions and discharges to better meet local needs.
The review covers BP’s five most material topics, identified using the process BP has followed for several years. BP describes these topics as: safe and reliable energy, diverse and affordable energy, cleaner energy, people (employee) energy, and local (community) energy. There are no surprises here, except for the comparatively small space allocated to cleaner energy, which deals with climate change and alternative power. Seven pages are dedicated to safe, diverse and affordable fossil-fuel energy before we find anything of substance about low-carbon alternatives.
Cleaner energy begins with BP’s six-point position on climate change. This is clear and succinct, as is the box on the following page that describes the action it is taking. But it would be interesting to hear more about how BP formulated this strategy and decided which technologies to invest in. The review also gives away little in terms of how close technologies such as carbon capture and storage are to widespread use.
The chief executive’s review follows a Q&A format, which allows Tony Haywood to tackle issues head-on and does not shy away from challenging questions, such as why only about 5% of BP’s capital investment is in alternative energy. However, this approach works best when the questions are posed by a recognised expert (not the case here), and Haywood quotes BP’s historical call for action on climate change in place of any new commitments. While the focus on operational performance and management systems in Haywood’s responses may be appropriate for BP at this time, the piece lacks inspiration.
Trends and indicators
There is a detailed data table giving five-year trends and a brief discussion of key indicators. Its positioning between the corporate governance and safety sections is odd, as is the way indicators are classified – environmental data appear in the table under the heading “safety”, for example. It’s also disappointing that BP still reports no numerical targets, a persistent gripe from readers and a point picked up by assurance providers Ernst & Young, whose observations appear in relevant places throughout the review.
There is a full page dedicated to the report from Duane Wilson, the independent expert appointed by BP to monitor improvements in the wake of the Texas City refinery explosion of 2005. This is admirable, but it would be more credible to publish direct excerpts from Wilson’s report instead of BP’s summary of his findings.
BP has taken some bold steps in this sustainability review, not least the decision to so evidently prioritise coverage of its oil and gas operations above its efforts to move towards low-carbon alternatives. This may satisfy mainstream shareholders, but will leave climate campaigners spitting tacks.
Follows GRI? Yes
Assured? Yes, limited assurance from Ernst & Young.
Materiality analysis? Yes, referenced in the review and explained in full online.
Goals? Overall business goals only, nothing specific to sustainability.
Stakeholder input? No
Seeks feedback? Yes
Key strength: Clear reporting strategy with a range of publications and online tools providing different levels of detail.
Chief weakness: Suggests a lack of commitment to tackling climate change.
Pleasant surprise: Readability