Introduction
British Petroleum (BP) and Royal Dutch Shell (Shell) are the world’s largest oil and gas companies. Both companies have a history of corporate social responsibility (CSR) reporting, including disclosures on topics such as environmental performance, community engagement, and employee health and safety. BP and Shell have committed to achieving gender balance across their workforce and have set a target to achieve 30% women in leadership roles by 2025 (Minefee & Bucheli, 2021). Companies report on their efforts to address modern slavery in their supply chains. This paper examines CRS reports of BP and Shell.
Analysis of Corporate Social Responsibility Reports
Code of Conduct
BP has a Supplier Code of Conduct, which requires its suppliers to comply with laws and regulations relating to forced labor and human trafficking, and the company conducts regular audits of its suppliers to ensure compliance (Minefee & Bucheli, 2021). Shell has a similar policy and regularly audits its suppliers to ensure compliance with its standards. Both BP and Shell have faced criticism for their CSR practices in the past.
Criticisms
BP
One of the most significant criticisms of BP’s CSR practices is its environmental record, specifically the 2010 Deepwater Horizon oil spill in the Gulf of Mexico (Sun et al., 2018). The disaster resulted in the death of 11 workers and caused extensive environmental damage, including the release of millions of barrels of oil into the Gulf (Sun et al., 2018). BP has been condemned for handling the disaster, including its initial response and efforts to clean up the spill.
Additionally, BP has been criticized for its role in contributing to climate change, which is a global problem. The company’s emissions of greenhouse gases, including carbon dioxide and methane, have been a significant source of problems for the company. British Petroleum has been accused of human rights violations and environmental damage in other countries, such as Colombia. Yet, the company has decided not to include this in its report.
The company has responded to these criticisms by implementing various environmental and social policies and initiatives, such as setting a target to become a net-zero company by 2050 and investing in renewable energy sources. British Petroleum also reports on its CSR efforts in its annual report and website, which includes information on its environmental and social performance and its policies and initiatives. Yet, the company’s critics often argue that BP’s efforts are insufficient to make a real impact and must do more to address its environmental and social responsibilities.
Shell
Shell has also faced criticism for its environmental and human rights record, particularly concerning its operations in Nigeria. In 2020, Shell was condemned for its poor record on reducing greenhouse gas emissions, as it was ranked last among its peers in an annual ranking of European oil and gas companies’ emissions performance by Carbon Majors Database (Andersson, 2020). In 2021, Amnesty International accused Shell of failing to properly investigate and compensate victims of human rights abuses in the Niger Delta region of Nigeria, where the company has operated for decades (Macchi & Zeben, 2021). Amnesty also claimed that Shell had failed to prevent human rights abuses by the Nigerian military, which had been deployed to protect the company’s operations.
Conclusion
In conclusion, CSR reporting is voluntary, and companies have discretion on what to disclose. In some cases, companies may choose not to disclose certain information in their CSR reports if they believe it could damage their reputation. Both BP and Shell have an established reputation for corporate responsibility, yet the research reveals that the companies do not include cases that may harm their brand image.
Reference List
Andersson, J. (2020) ‘Ghost in a shell: the scenario tool and the world making of Royal Dutch shell,’ Business History Review, 94(4), pp. 729-751.
Macchi, C., & van Zeben, J. (2021) ‘Business and human rights implications of climate change litigation: Milieudefensie et al. v Royal Dutch Shell,’ Review of European, Comparative & International Environmental Law, 30(3), pp. 409-415.
Minefee, I., & Bucheli, M. (2021) ‘MNC responses to international NGO activist campaigns: Evidence from Royal Dutch/Shell in apartheid South Africa,’ Journal of International Business Studies, 52(5), pp. 971-998.
Sun, H., Ikram, M., Mohsin, M., & Abbas, Q. (2021) ‘Energy security and environmental efficiency: evidence from OECD countries,’ The Singapore Economic Review, 66(02), pp. 489-506.