BP’s attempts to compensate the victims, in my opinion, are not enough to change the corporation’s reputation. The company ignored the oil leaks that had been detected before the accident. In fact, this depicts an organization that does not embrace ethics in its operations. Therefore, compensation will do little to change consumers’ perceptions about the company’s operations. Equally, the company was slow in responding to the disaster because of inadequate contingency plans. Therefore, compensation will not restore the reputation of BP Corporation. In my opinion, the company should have averted the oil spillage disaster.
BP failed to recognize a number of ethical considerations. First, it underestimated the risks and willfully cut corners to save money. In addition, BP did not have an effective crisis management plan in place. Finally, it did not have an effective contingency plan to deal with risks.
BP’s reputation is important for the consumption of its products. A good reputation encourages and keeps customers loyal to the products of the company. However, a bad reputation discourages the use of the company’s products. A bad reputation will encourage customers to boycott the company’s product leading to losses. For instance, the oil spillage disaster resulted in customers boycotting BP’s gas stations and products. Therefore, reputation will determine the rate at which an organization’s products are consumed by customers.
A good example of an organization whose reputation was at risk because of an ethical blunder is the Toyota Motor Corporation. The Corporation had sold millions of faulty vehicles. In an effort to regain its reputation, the corporation recalled three of its models (Ireland, Hoskisson & Hitt, 2012). Toyota Motor Corporation initiated recalls with the help of the National Highway Safety Administrators (NHTSA). The company started by identifying the faults in the three models. It then trained its employees on ways to correct faults that were found in the three models. Equally, drivers of the three Toyota brands were cautioned to stop driving if pedals became sticky. Finally, Toyota Motor Corporation designed and manufactured new pedals that would replace the malfunctioning pedals. Toyota Motors’ reaction to the faulty models saw the company being favored by many customers.
Moreover, there is an example of an organization that identified risks and dealt with the same. It was identified in Coca-Cola Amatil that there were bottling risks. The management asked Vero to give recommendations on the issue. The company swiftly implemented most of the recommendations, thereby, mitigating the risks (Dick, 2007). The company’s employees were educated on the importance of some of the procedures that saw a reduction in risks. Besides, the construction department was involved in reducing the High-Intensity Discharge (HID) lighting. This saw the exposure of products to HID being reduced. Similarly, measures were implemented to address shortages associated with the Christchurch earthquake. This prevented shortages and other risks that could have negatively impacted the company.
Did BP Company conduct its operations ethically? BP’s operations were not conducted ethically. This resulted in negligence that saw the loss of innocent lives. Therefore, the company’s efforts to compensate the victims could not be termed as ethical.
References
Dick, H. (2007). The internationalisation strategies of small-country firms: The Australian experience of globalization. Cheltenham: Elgar.
Ireland, R. D., Hoskisson, R. E., & Hitt, M. A. (2012). Understanding business strategy: Concepts plus. Mason, OH: South-Western Cengage Learning.