A few years back, salesforce.com CEO Marc Benioff urged America's corporations to view philanthropy and community improvement as missions equally important to the eternal search for profits. He summarized his thoughts in a little book titled "Compassionate Capitalism: How Corporations Can Make Doing Good an Integral Part of Doing Well."
And while I doubt anyone would argue that last week's Deepwater Horizon disaster qualifies as "good," or that the underground oil reservoir now spewing its contents into the Gulf of Mexico is the "well" that Benioff had in mind, I do believe that in this case, in the depths of this particular PR nightmare, there's one company that's living up to Benioff's standards of corporate stewardship: BP (NYSE: BP).
BP?! Are you insane? They're the bad guys!
Yes, yes, I know. The conventional wisdom on this story reads opposite. BP's the outlaw oilman, reaping billions in profits from destroying the Earth. It's the cowboy wearing the black hat, the starring villain in There Will Be Blood -- I get it. But if you'll lay aside the pitchforks and torches for a moment, I'm going to explain to you why I think BP's doing a standup job in this here crisis.
You see, when a PR disaster blows up in its face, any corporation's standard operating procedure is to: "Admit nothing, deny everything, and make counter-accusations." As the lawyers will tell you, admitting guilt is no way to beat a lawsuit.
Mea culpa? Heck no! Somebody-elsa-wasa-culpa
That's why, when caught with its hand in the mortgage market cookie jar, rather than issuing an immediate mea culpa and lamenting how a relentless drive for profits caused it to lose its moral compass, Goldman Sachs CEO Lloyd Blankfein instead responded with the improbable assertion that he was "doing God's work."
It's why Toyota threw everything plus the kitchen sink into the defense against charges of shoddy workmanship on its automobiles, blaming first floor mats and then gas pedals -- anything to avoid admitting that it was potentially a software problem, and very expensive to fix.
Most pertinent of all, however, it's why ExxonMobil (NYSE: XOM) -- BP's predecessor in the field of mega-oil PR blowups -- spent the better part of two decades arguing somebody-elsa-wasa-culpa for the 1989 Exxon Valdez incident. It's why Exxon denied that it did anything really and truly culpable and worthy of punishment, and then paid millions of dollars to what seemed like trillions of lawyers in an all-out effort to reduce the $5 billion punitive damages award originally levied against it.
Round up the usual suspects
Given the corporate track record, and Benioff's admonitions notwithstanding, what's truly surprising about BP's reaction to the Gulf of Mexico disaster is ... well, that it's taking responsibility. After all, there is no dearth of decoy targets to which BP could have directed the public's attention in this mess. Chief among them, Transocean (NYSE: RIG) owned and operated the rig under contract to BP, drilling the well and pumping out the oil. It was on Transocean's watch that the disaster occurred. BP could easily have pointed the finger at Transocean, accused it of ecological murder most foul, and diverted the public's outrage "thattaway."
Or consider the case of Halliburton (NYSE: HAL). It has been rumored that the company's potentially poor cementing of the well may have allowed natural gas to escape to the surface of the rig, causing an explosion. While the investigation is ongoing, Halliburton is likely responsible for a similar incident last year off the Australian coast. After the Deepwater Horizon blew up and sank, a fail-safe device called a blowout preventer manufactured by Cameron (NYSE: CAM) was responsible for shutting down BP's well, and preventing the environmental disaster that resulted. It failed.
My mess. I'll fix it
Regardless, when describing the disaster and what BP intended to do about it -- how it would compensate those harmed by the oil slick and repair the environmental damage -- the company's bull's-eye-in-chief made no bones about his intentions: "This ... is our responsibility," promised CEO Tony Hayward. "Where there are legitimate claims for business interruption, we will make them good."
Amazing.
According to Hayward, it doesn't matter that: "This wasn't our accident. This was a drilling rig operated by another company. It was their people, their systems, their processes." Regardless, BP is: "responsible for the oil and for dealing with it and for cleaning the situation up."
And speaking of dealing with it, Hayward's deputy, chief operating officer Doug Suttles, advised that BP has already begun drilling a relief well, whereby BP will seal the original leak. He promised on Tuesday that BP would have a multistory steel containment system installed over the main leak "within a week." In fact, BP began deploying said oil cap last night.
Foolish takeaway
The oil industry in general, and BP in particular, have suffered a massive public relations hit over Deepwater Horizon. So as you're motoring to the protest rally this weekend, the hatchback of your internal combustion engine-powered automobile stuffed full of placards decrying BP's greed for profits, I'd urge you to remember:
So far, BP's response to this crisis has been beyond reproach.
