International Oil Companies: Company Culture – Part III

by Margaret Kearney, Louisa Kellogg, Jacqueline Ho, Katherine Wong

Company culture, which includes how the companies engage with the media and stakeholders, disclose information, and present themselves to the world, influences Exxon Mobil Corp. and British Petroleum’s stances on climate change.

The degree to which BP and Exxon Mobil choose to disclose company information lends us an insight into company culture. Transparency International’s 2011 report on oil and gas companies ranked BP higher than Exxon Mobil for transparency in all three measures of disclosure.

Exxon Mobil’s lag in transparency extends to information about greenhouse gas emissions. As an American company, Exxon Mobil is required to report emissions to the government in an annual toxics release inventory. But Exxon Mobil does not make this data available on its website. BP, though it is not required by U.K. law to engage in greenhouse gas reporting, does so and includes its results on the company’s website. Because BP is relatively more transparent than Exxon Mobil, especially regarding greenhouse gas emissions, it seems that BP must defend its decisions to more people and has a larger incentive to make decisions with the public in mind.

Both Exxon Mobil and BP regularly receive coverage in mainstream media. Recently, they have built up a social networking presence. Exxon Mobil and BP both have Twitter accounts and YouTube channels. BP is notably more active on these social networking sites than Exxon Mobil. BP is far more active than Exxon on YouTube and has uploaded 350 videos to Exxon Mobil’s 38 as of May 2012.

BP’s active presence on social networking sites allows people to engage in a dialogue with the company — or at least make their opinions known. Because BP is more open to dialogue than Exxon Mobil is, BP is more likely to hear opinions about renewables and climate change, which can consequently shape company decisions.

Both Exxon Mobil and BP’s official websites devote pages to stakeholders, but the language they use is very different. BP encourages dialogue with stakeholders and actively seeks out opinions from stakeholders of all levels. This provides customers, shareholders, employees, and other stakeholders an opportunity to voice their concerns about climate change and BP’s decisions regarding renewable energy. Exxon approaches relationships with stakeholders from the perspective of maintaining stability.

For example, while BP says they “use a variety of methods to communicate with and listen to our customers, including interviews, surveys, feedback tools and marketing surveys,” Exxon says its goal in regard to customer relations is simply to “provide trusted, quality products” using strategies such as “packaging optimization.” Exxon Mobil’s approach to stakeholder relations lends itself to safer decisions for the company, but not necessarily for the environment or the people who live in it. As a result, Exxon Mobil continues to develop its oil and gas resources, while BP invests in renewable energy.

The aftermath of the 1989 Exxon Valdez spill and the 2010 Deepwater Horizon spill shaped the way the two corporations present themselves.

After the Exxon Valdez spill, Exxon Mobil was slow to make a statement about the spill and gave the media limited information. Though BP also fumbled somewhat in its dealings with the media after the Deepwater Horizon spill, the company chose to present the message that the incident was an impetus for change for the company.

BP’s response was no doubt influenced by the backlash against Exxon in 1989. Since the Exxon Valdez spill, Exxon Mobil has been labeled a “bad” company by environmental groups and has not made an effort to change this image. BP, on the other hand, chose to use the spill aftermath as an opportunity to say that they could change and were, in fact, a good company. Exxon Mobil’s label as a bad company and BP’s label as a good company influenced the way they approach the challenges of climate change and renewable energy.

Though company culture is difficult to define, we were able to get an idea of how Exxon Mobil and BP want to be perceived and how they want to engage with outside opinions by examining the way the two companies deal with the media and the language they use when representing themselves. BP is more open to dialogue with outside opinions and presents itself as a company that is constantly moving forward and changing. Exxon Mobil has shut itself off from many outside voices and instead prioritizes stability. Thus, BP invests more in renewable energy, while Exxon continues to focus on fossil fuel production.

Though they often appear to be interchangeable and monolithic, “big oil” corporations sometimes make completely different decisions. We wonder how BP and Exxon Mobil Corp., two companies that appear very similar in terms of corporate and shareholder structure, size, and regulatory standards, have come to such divergent views on climate change and the development of renewable energy. BP has been vocal about the need for a transition to renewable energies and the threat of climate change, while Exxon has continued to present itself as solely an oil and gas company with no further obligations.

BP is more invested in renewable energy because it has more incentive. The company is more engaged in the interests of those outside its company executives such as stakeholders and the general public, so it has an obligation to make long-term decisions with the input of more people. As activists, we are left with a more comprehensive understanding of what influences corporate behavior regarding climate change and renewable energy. We now understand that oil corporation, which we once thought of as “homogeneous monsters,” are more complex and varied than we once thought and that transparency and company culture are vital to consider when attempting to influence company behavior.

If we hope to push Exxon Mobil in the direction of developing more renewable energy, we should focus on balancing the relationship between Exxon Mobil and the U.S. government and increasing dialogue between the company and sources of outside opinion.

This article is the last of three in a series written by a Brown University Undergraduate Group Independent Study Project (GISP). Read the first and second installments.

photo by Marianne Muegenburg Cothern: http://www.flickr.com/photos/mmcothern/7423982576/