Enron, Exxon, Barings Bank, Halliburton, MCI Inc. and now British Petroleum. The list of mega corporations that got embroiled in corporate scandals is long and endless. Corporate scandals appear to be a staple in online news, newspaper headlines and nightly telecasts. For every big business that finds itself under public scrutiny because of some form of inappropriate activity, another one appears poised to take its place. One comes and goes as another emerges to continue the cycle.
Dig underneath each corporate mess and you will find actions spurred by selfish motives. In Enron’s case it tried to hide the company’s enormous losses and make it appear that the company is making huge amounts of money. The company’s executives conspired to defraud, deceive and hoodwink its shareholders and the general public just to satisfy their despicable selves. In the end, their own crimes caught up with them.
There are many ways by which society reins in corporate greed – laws, government agencies, media, consumer organizations, etc. Most companies themselves adopt policies that supposedly proclaim corporate social responsibility. In the manuals of most businesses you will find Codes of Ethics or Codes of Conduct that are supposed to guide them to conduct their affairs in an ethical, responsible manner.
ENRON’s Code of Ethics
In Enron’s case, its Code of Ethics proudly declares that it is a company that “…believes it has a responsibility to conduct itself according to certain basic tenets of human behavior…” The code further declares “We treat others as we would like to be treated ourselves. We do not tolerate abusive or disrespectful treatment. Ruthlessness, callousness and arrogance don’t belong here.”
In the aftermath of the scandal, the document reads as a testament on how a company will go to great lengths to deceive the public even to the point where they will have to deceive themselves, too. Enron’s case is an example of how a mega corporation has grown too calloused that it has forgotten to uphold the values it swore to uphold.
Deepwater Horizon Oil Spill
Now comes the Deepwater Horizon oil spill and the company that’s at its epicenter – British Petroleum.
Much is being written about BP’s responses and overall conduct in what is described as the worst oil spill in American history. Some estimate the losses due to the disaster to run up to $5.5 billion. Observers say that certain industries, livelihood of thousands of families and the environment are taking quite a beating. Ultimately, the economy, which is still emerging from the clutches of a downturn, and society at large will absorb the greater part of the impact.
The President’s Pronouncements
Recently, President Barack Obama made it specifically clear that BP would have to shoulder responsibility for the mess. Considering its spotty record in dealing with similar disasters, BP’s level of commitment to the $20 billion pronouncement is still up to anyone’s guess. Back in 2005, a government panel undermined the company’s safety policies “at all levels of the corporation” during the investigation of an explosion at its Texas refinery. In the 1990s, BP ran afoul with authorities for certain activities at its Alaskan sites. On the Deepwater Horizon site itself, there were a couple of notable accidents prior to the current disaster.
BP’s Code of Conduct
Similar to Enron, BP has its own Code of Conduct, portions of which read as follows:
“At BP our aspirations are – no accidents, no harm to people and no damage to the environment.
We are committed to the protection of the natural environment, to the safety of the communities in which we operate, and to the health, safety and security of our people.”
The Code further affirms: “Working to protect the natural environment and the health and safety of the communities in which we operate is a core commitment of our company.”
Corporate Deja Vu
Reading the passages to BP’s Code of Conduct brings about a sense of corporate deja vu, like its ENRON all over again. The time and situations may differ but beneath the surface is the same corporate callousness, the same utter disregard for the values they promised to uphold.
The lessons brought about by the oil spill at the Gulf of Mexico are many. Even the government cannot escape from being contributory to the problem. Yet, at the bottom of it all lies one of the most basic problems facing society today: corporate greed.
Actions dictated by greed and pursuits motivated by personal gain are all wrong. Committed at a corporate scale, these actions undermine a nation’s progress and hamper a society’s pursuit for a better and just life for its constituents.
Corporations need to be reminded that the right to make profits also bears with it the duty to be socially responsible. The pursuit of one cannot be achieved without accomplishing the other.