Questions About the BP Oil Disaster

There’s been an enormous amount of reporting and commentary about the disaster at BP’s Deepwater Horizon oil rig and the ensuing oil spill. One of the challenges of blogging about this story, from an ethics point of view, is figuring out where to begin. The story of the Deepwater Horizon is such a rich and complex one that Business Ethics profs will be teaching this case for decades.

Of course, what questions we need to ask depends in large part on what our purposes are. But the meta-question (“Which question is the right question?”) is still worth asking, not least because at least some of the questions currently being asked may not be a) fruitful or b) answerable.

So, what’s the right question to be asking about the worst oil spill in U.S. history?

Here’s a very incomplete list of possible questions:

  • Who is to blame? BP’s CEO? BP as a whole? The rig’s foreman? The crewmembers directly involved? Transocean (the owner of the rig)? Halliburton (subcontractor for a crucial element of the drilling operation)? The U.S. Government’s Minerals Management Service? Or, more appropriately, we could ask: what’s the right way to apportion blame among those individuals and organizations?
  • What role did the pursuit of profit play? Are there other, more important, ideas likely to have influenced the mind-set of the persons most directly responsible?
  • Who is (ethically) responsible for cleaning up the mess — BP? The U.S. government? Coastal state governments? (Note that that question is in principle different from the one above.)
  • What penalties should companies pay in the aftermath of an oil spill? (See the discussion at the excellent Marginal Revolution blog, here.)
  • Is there anything ethically unique about the Deepwater Horizon disaster, or is it “just” another disaster like others we’ve seen before?
  • Assuming that oil spills, big or small, are more-or-less inevitable, are such spills an acceptable cost of our unfortunate addiction to oil? As the old saying goes, “you can’t bake a cake without breaking a few eggs.” Does that apply here?
  • What cultural factors within BP are likely to have played a positive or negative role? Or, since most of us don’t know much about the corporate culture at BP, what might be the crucial variables here? What should we want to know about BP’s (or Halliburton’s) corporate culture?
  • If you were a senior executive at another oil company, how would or how should your day tomorrow look different than a randomly-selected day before the blowout on the Deepwater Horizon? That is, is there anything for other companies to learn, here?
  • Beyond the massive cleanup to be carried out over the coming years (and it will be years), what should be on BP’s agenda for the next few years? What should BP (and Transocean and Halliburton) learn from this?
  • Does this incident prove that regulations are too lax? After all, no system of regulation is perfect. Even tough laws against murder don’t bring the murder rate to zero. Did this disaster happen because of, or in spite of, the current regulatory regime?
  • Would your own moral reaction to the Deepwater Horizon spill be different if you were an employee of BP (say, an employee not directly involved)? Or if you were a BP shareholder?
  • Should shareholders in BP feel bad about this? If you think they should feel bad, should they feel more, or less, responsible than, say, BP’s customers?

So, if there’s anything to be learned from this disaster, what questions should we be asking?

I should add the one thing I know for sure about the questions listed above: none of the presents an easy, obvious answer.

11 comments so far

  1. Barbara Kimmel on

    Industrial accidents are bound to continue to happen as the world’s population (and its needs) expand. Accidents like BP may be truly unavoidable. The best we can do here is work to anticipate future problems, and deal with them in a transparent and honest manner.

  2. Jim Gaa on

    Good questions. Especially the less obvious one about how BP employees might feel about this is something worth a close look. Here’s an anecdote.

    Somewhere around 1996, I attended a dinner, and was seated next to an employee of Imperial Oil — the Canadian operation of Exxon. I asked him about the Exxon Valdez. He said that after 7 or 8 years, he and his colleagues were still negatively affected by the spill. The reason was that they learned something extremely negative about the morality of their employer and its upper management that they didn’t know before.

    Their concern about management, he reported to me, was their ongoing attempts to minimize responsibility and liability for an environment disaster. The negative effects on their attitude and morale persisted, just as the oil did in Prince William Sound. The oil is still there; it would be interesting to know whether tide of hiring and departures has removed the besmirched image of Exxon management in the eyes of its employees.

    From my reading of the news so far, BP shows every sign of going down the same road as Exxon did. On the one hand, they’ve promised to pay for the damage; but, as one commenter I read noted, we should believe that when it happens. Exxon never came close to paying for the damage it caused. And on the other hand, even if one believes BP’s promise, it appears to have been working very hard to downplay the event and to prevent disclosure of important information (such as, how much oil is leaking out of the pipe?).

    Jim Gaa

  3. Lorraine Whellams on

    The whole idea of blame and who should pay is intriguing in any situation. Was the accident due to negligence or just an accident? Courts often have to rule in these situations. But one thing is for sure…taxpayers should not be on the hook for this one. I pay car insurance, house insurance, disability insurance because I never know when an accident might befall me or someone on my property. Can each country not set up an insurance scheme whereby companies pay so that in the event of an accident, no individual company foots the bill, but collectively they all do. Will this ensure that companies won’t abuse this…no, but if rates go up due to accidents, it may make companies cautious in the same way that individuals are cautious about cleaning their walks of ice and snow, or driving within the speed limit. Just a thought…BTW all the questions were intriguing and worthy of consideration.

  4. Jim Gaa on

    In response to Barbara Kimmel, it’s obviously true that accidents happen and some are unavoidable and even unpredictable.

    But they don’t always “just happen”, because it’s also true that many accidents can be anticipated and are avoidable. As of now, I see no evidence that this one couldn’t have been anticipated (surely it was anticipated as a possibility) or that it was unavoidable (so far, it looks like it was avoidable) — or that the extent of the damage (which will in all likeihood extend not for years [as Chris suggests] but for decades if not permanently in some aspects) was couldn’t have been anticipated and/or was unavoidable.

    The important point is also obvious: while accidents do happen, people are supposed to take “reasonable” steps — do their best? — to either avoid them or to mitigate the damage they cause. Negligence exists when people or companies do not take “due care”. Did BP and its contractors, and their employees take due care?

    As one comment I read noted, Ford Pintos got into accidents. There is no sense in which Ford could have predicted or anticipated specific accidents. From Ford’s point of view, they were unavoidable. But so what? The question is what should Ford have done to prevent an event that they did anticipate and could have avoided: passengers being burned alive when the accidents did happen?

    So, I can agree with your statements that:
    a) some accidents are unavoidable, at least in the sense that they may be the result of a confluence of unpredictable and uncontrollable events;

    b)that companies should work to anticipate future problems — and, I would add, work to avoid them and to figure out what to do if/when they do happen;

    c) and should deal with problems honestly and transparently.

    But I just don’t see what these points have to do with this disaster — except that, based on what has been reported so far, BP and its contractors didn’t adequately “anticipate future problems” or how to deal with them, and that they also haven’t “deal[t] with them in a transparent and honest manner.”

    In fact, based on the information available so far, it appears to be quite the contrary. It looks like BP et al. haven’t done their best.

  5. […] Filed under: Teaching,business ethics — southwerk @ 1:18 pm Tags: BP, Chris MacDonald Chris MacDonald answers that with a barrage of ethical questions designed to inspire creative thinking on the part of the […]

  6. Pascal on

    Indeed there are dozens of useful questions. Seen from “old europe”, one thing is quite striking , it’s the fact that the leadership of cleanup and leak-sealing operations seems to be entirely delegated to BP. I would hate to see my health and safety in the hands of a private entity whose primary moral duty is to make money, not to help me – whatever the quality of the people on the front. This seems to me a huge systemic flaw. No surprise they are hiding things!
    Okay, they have the technical skills, but I would much rather see a US federal body in charge of setting priorities, taking decisions, steering the wheel.

  7. praymont on

    What’s crucially important (as noted by Jim Gaa, above) is that “BP and its contractors didn’t adequately ‘anticipate future problems’ or how to deal with them.”

    It’s more than 40 days since this leak began and it’s clear now that the oil industry has no adequate way of dealing with this kind of accident. For that reason, they should never have initiated this drilling operation.

    Before they began drilling that deep they (or the regulators) should have asked, “What if something goes wrong? How severe could the repercussions be? If there could be severe repercussions, do we know of a reliable way to minimize the harm if something does go wrong?”

    Given the answers to these questions (the repercussions could be very severe and we have no known way to minimize harm), they should never have started drilling that deep.

    Incidentally, the Soviets apparently used nukes on 5 occasions to stop leaks connected with underwater drilling:

  8. Erwin on

    To answer Lorraine Whellams, there is a fund all companies pay into, it’s called the federal government and the payments are called royalties (for the resource extracted). The question is, what is the purpose of this transfer of wealth (which is independent of taxes)? Given that governments have a long track history of being expected to foot or subsidize the bill of any mitigation of a large disaster, is there an expectation that they would assist (financially) in future disasters and does the payment of royalties somehow imply that they will backstop any disaster too large for the company to handle? If the responsibility to pay should be in the hands of those who profit from the undertaking, that should include BOTH the government and the companies involved.

  9. […] (and Managing) Complexity Posted June 5, 2010 Filed under: Uncategorized | In my previous blog posting on the BP oil-rig disaster, I pointed to the disaster’s ethical complexity, measured in the sheer number of relevant […]

  10. […] While bullying may be a particularly dangerous in healthcare, where patients’ lives can easily depend on just how well a team of heal professionals functions, bullying, or even subtler forms of interpersonal conflict, can be common in any kind of workplace. And indeed, while the risks of poor team performance in healthcare are especially vivid, it has the potential to have serious negative effects — effects far beyond the people directly involved — in all kinds of businesses that themselves have significant impact on people’s lives or the natural environment. It isn’t difficult to imagine, for example, bullying being part of the root cause of the kind of poor teamwork that might result in an environmental catastrophe like BP’s Deepwater Horizon spill. […]

  11. […] too. BP is perhaps the most dramatic example that comes to mind. It was the company behind the explosion on the Deepwater Horizon, and the subsequent spill that devastated a big chunk of the Gulf […]

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