None of Us Lives in a Vacuum

June 17, 2018 Management

The demand for natural gas has doubled since the early 1970s and is set to double again by 2020, partly because gas is more environmentally friendly — for equivalent electricity output gas generates less than half the emissions produced by coal. 5) As part of China’s celebration of the 50th anniversary of the revolution, the Chinese adjusted the use of some of the coal-fired industrial plants around Beijing. In a city that is often covered by a blanket of smog, people could see what they were celebrating. 6) The story is just one example of a new set of expectations.

People want energy, because energy means liberty, mobility, growth and the chance to improve living standards. 7) But people want a clean environment, too. Yet, at the moment consumers and government seem to be in denial. They refuse to accept their own responsibility for increasing costs to the quality of life which are imposed when we all demand more. And they deflect the responsibility onto the oil and gas sector. 8) There are no simple and easy answers to global warming, traffic congestion, air quality and waste disposal. Oil companies can’t solve these problems on their own. But we can make a contribution as part of a common effort.

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We all need to take measures that transcend the apparent — and unacceptable — trade-off between better living standards and pollution. 9) Take climate changes. I disagree with those in our industry who believe that the only answer to climate change and global warning is to question the science, deny responsibility and ignore reality. Of course, the science is provisional; there are many things we do not know. But it is an undeniable truth that people link energy to pollution, that they fear for the environmental future and that they believe companies should raise their aspirations. 0) We did some poling. When asked whether they associate energy with progress or pollution almost 40 percent of respondents say the first association is with pollution. But 80 percent believe that business has ability and the responsibility to find answers. 11) We can’t afford to disappoint them. That’s why, in a speech in Yale last year, I committed BP to reducing our emissions of greenhouse gases by at least 10 percent from a 1990 base by the year 2010. Because our business is growing rapidly, that is a reduction of more than 40 percent from the level we would have reached if we took no action at all.

And it is why we have pledged this year to introduce new clean fields in at least 40 cities around the world by the end of the current decade. 12) But our decisions on global warming and clean fields also taught us a larger truth. We learned that for a global company like ours — indeed, for any international company with a large number of highly skilled employees — top management can no longer expect to make policy in a vacuum. 13) When we accepted that, on the evidence, global warming was a true problem, we did so in part because many of our employees had told us that we could not go on living in denial.

Their families and their children, in particular, believed we were part of the problem. Our staff found it intolerable that we seemed to be on the wrong side of a fundamental issue. 14) I have never received so many personal e-mails from BP Amoco employees as I did after announcing our new policy. A few weeks later we asked all our teams for their direct support, so that we could identify ways of reducing our own emissions. I got hundreds of pages of e-mail from people all around the world with their detailed practical suggestions. 5) The old order, symbolized by the remote and arrogant corporations, convinced of their own virtue and invincibility, is passing. The new order is neither comfortable nor predictable, but it reminds us that companies, however big, are simply servants of society. We exist only because someone wants to buy what we produce. In a complex world, the companies that thrive will be those that can combine the traditional strength, like a strong financial balance sheet and a great portfolio of assets, with something new: the capacity to listen and to learn.


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