Crude politics

Human rights: BP

Crude politics

BP has been honourable in its intentions, says Terry Macalister, but day-to-day operation is proving to be far more difficult

The Guardian, November 17, 2003,,1087120,00.html

BP has taken the brunt of complaints over human rights with its involvement in the Baku to Ceyhan pipeline project, and Colombia before that, but it has also tried harder than almost any other company to put together a credible corporate policy on the issue.

The oil and gas giant played a major role in drawing up the Voluntary Principles on Security and Human Rights alongside governments, voluntary groups and other firms.but has led from the front speaking openly and regularly on these kinds of issues. Chief executive Lord Browne spelled out the importance of this wider stakeholder debate in a letter to his own employees earlier this year, arguing that the long-term future of BP was dependent on its environmental and social performance.

But there is little « do-goody » about the company’s approach. Human rights, Lord Browne argues, should be supported not just because they give freedom to individuals but because they are good for business. « Societies that respect human rights create positive conditions which enable private enterprise to succeed and thrive, » argues the the world’s third largest oil group. While governments have the primary responsibility for this area, good corporate citizens such as BP recognise that they must help out too. The oil and gas group is committed to ensuring its operations do not negatively impact on human rights but says its business makes a contribution to provide the means for governments to meet their responsibilities. « The payment of taxes and the monetization of oil and gas resources can provide the financial opportunity to better enable governments to meet their human rights responsibilities, » it explains.

In the past this has been a path most companies have been loth to tread. Firms such as Shell in Nigeria or Premier Oil in Burma have traditionally argued they could point the way to good practice by ensuring there were no human rights abuses on their projects but could not tell an elected government how to rule in its own land. The BP policy goes some way to breaking down this barrier, as it did when it insisted signature bonuses and other payments to government in Angola were made public, despite opposition from the authorities in Luanda.

But there are difficulties. Peter Frankental, head of economic relations at Amnesty International, says BP’s public rhetoric on the issue cannot be faulted but implementing policy at individual business units is proving tough. « This is a difficult issue for all companies but especially for BP, which has tied its flag so publicly to human rights, » he argues. « Commercial considerations can find themselves clashing with other imperatives and there can be very complex issues on the ground putting some of the [human rights] policies into practice, » he adds.

Another problem is that BP rarely acts alone in these enormously expensive oil and gas schemes, meaning it might find opposition from its partners to a high-principled stance which might cost money and cause conflict with the local government.

Before ructions over the Baku pipeline, the most sensitive issue for BP was its involvement in Colombia, where it was accused of collaborating with brutal local security forces. The British company, which produces 40% of the country’s oil from the Cusiana and Cupiaga fields, has been trying to tackle these issues by building a more open relationship with the state armed forces and established regular meetings where local communities can bring their concerns. BP has also built the voluntary principles into contracts with private security providers and says it is trying to ensure they are properly implemented. In addition, it claims to have encouraged and supported government initiatives to strengthen the judiciary and the rule of law by supporting a « house of justice and peace » now under construction, with its support, in the area.

Amnesty – a strong critic when BP hit trouble in Colombia at the end of the 1990s – admits, understandably, it struggles to keep track of all multinational activities globally. The moves in South America have been audited at BP’s request by accountancy firm Ernst & Young, which found little to criticise there.

But it remained unimpressed by similar moves to spread the voluntary principles into other key markets for BP such as Angola and Azerbaijan. « Of these three countries we only saw evidence of discussions with third parties regarding BP’s expectations on the implementations of the voluntary principles on security and human rights (VPSHR) in Colombia. This suggests that the expectations and assurance mechanisms for the VPSHR implementation could be strengthened, » say the accountants. BP itself admits it has fallen short of its own expectations in Algeria, another important country with a dreadful human rights record, and where the UK firm is the largest foreign investor. The oil major is planning to spend $2bn over the next three years yet it admits that international observers are worried by excessive use of force and alleged massacre of civilians by armed groups.

BP Algeria staff and contractors providing private security at the installations have been trained and made aware of the voluntary principles but these same guidelines have not been written into contracts with private security firms. BP also admits « we have not been so successful in influencing the area that is out of our direct control – the provision of public security by the state. »

BP sees the availability of energy as a fundamental pre-requisite to realisation of the right to development but it sees human rights as a part of the wider field of business ethics. While the company strives for higher standards it admits it was forced to sack 132 staff for fraud, conflict of interest and other abuses. Nearly 40 contracts were cancelled or not renewed because of unethical behaviour.

· Terry Macalister is the Guardian’s industrial correspondent.