An audio clip of the BBC’s May 3, 2010 interview with me is available on this site. Below is my summary of what I said and what else I’d have liked to say.
These are other pieces by me commenting on the Deepwater Horizon oil spill:
- “Communicating about the BP Oil Spill: What to Say; Who Should Talk” (May 30)
- “Why We’re Vilifying BP” (June 4)
- “Jim Joyce, Tony Hayward, and how to apologize” (June 5)
- “The ethics of risk communication consulting and the BP oil spill” (June 6)
- “President Obama’s handling of the Deepwater Horizon oil spill” (August 8)
- “Did the BP spill in the Gulf of Mexico create a crisis for the oil and gas industry?” (September 12)
- “Risk Communication Lessons from the BP Spill” (September 13)
On April 22, a BP exploration oil well in the Gulf of Mexico had a disastrous blowout, killing eleven crew members on the offshore Deepwater Horizon drilling rig and spilling untold amounts of oil into the Gulf. Efforts to cap the spill have so far proved fruitless.
For BP, talking about the blowout is an example of crisis communication (high hazard, high outrage). As is usual in crisis communication, there is also a need for outrage management – managing an enormous amount of entirely justified outrage, but especially responding to aspects of the event that are likely to arouse greater-than-justified outrage because of outcome-biased thinking (“hindsight bias”).
But BP’s main risk communication task isn’t to “calm” fisherman rightly worried about their livelihoods or environmentalists rightly worried about waterfowl. Its main communication task is to validate these and other worries and to acknowledge, over and over, its responsibility and its contrition for its role in what is happening. On May 3 I received an email from BBC radio, asking whether I was “still representing” BP and whether I would do an interview “about the effect of the oil spill on the corporate brand.” I replied that I never “represented” BP: “I’m a risk communication consultant that BP has called on from time to time for consultations and seminars … but nothing recently, and nothing related to the Deepwater Horizon blowout.”
I added that “I would be happy to do a radio interview on how I think companies should behave in a situation like this one, and on how well BP stacks up.” And I wrote: “It’s a lot easier to talk publicly as an outside expert than as an insider … who’s either ‘representing’ the company or telling tales out of school (I do neither).”
The actual May 3 interview lasted less than four minutes, and was aired without cuts. The entire nightly newscast is on the BBC website (at least temporarily). Or you can listen to the interview without the rest of the newscast on this site.
These are the main points I made:
- BP is doing a pretty good risk communication job so far. I’d give it a B.
- BP has mostly avoided what are perhaps the two most common corporate errors in these sorts of crises: minimizing what happened, and scapegoating other organizations that arguably share in the responsibility for what happened.
- It has acknowledged its responsibility and expressed its contrition. And it has promised to pay for the cleanup.
- Although there was a time when these admissions and promises might have increased the company’s legal liability, that is no longer the case; if anything being forthright and apologetic reduces a company’s liability by reducing its vulnerability to punitive damages.
- BP would have done better still if it had expressed wishes (for example, wishing that it had lobbied for instead of against an additional failsafe device, the so-called acoustic switch).
- BP should also be acknowledging other memorable accidents in recent company history (for example, the 2005 Texas City refinery explosion), rather than leaving it to reporters to bring up these precedents.
- BP will still pay a heavy reputational price for the spill itself – as it should. But it is doing what it can to avoid communicating in a way that arouses additional outrage and thus adds to the price.
Some additional points I would like to have made:
- Although BP CEO Tony Hayward [I called him “Tony Howard” in the interview – sorry] has communicated well, some subordinates have done less well. At a televised local meeting with Alabama fishermen, for example, the BP spokespeople refused to answer questions.
- One of Hayward’s nicest risk communication moments was his acknowledgment that of course many people will want to reconsider offshore oil development in light of the disaster, and that if it goes forward at all it will certainly do so with more stringent safety requirements in place.
- Hayward comes closer to scapegoating than I like when he insists that the spill wasn’t really BP’s fault, since another company entirely owned and staffed the rig (under contract to BP). I believe this is a true statement, but I think Hayward shouldn’t be stressing it so much. BP did a better job with a 1990 oil spill in Huntington Beach, California. The CEO of BP America at the time declined to hide behind the tanker company most directly responsible for the spill, saying instead something like this: “Our lawyers tell us it’s not our fault. But we feel like it’s our fault, and we’re going to act like it’s our fault.” I have often cited this good example. See the section on “Apology” in my 2002 article on “Lawyers and Outrage Management.”
- BP’s elaborate effort to rebrand itself as “Beyond Petroleum” is likely to exacerbate the reputational damage done by the spill. And justifiably so. It set itself up as a green icon. It thus attracted iconoclasts, eager to brand the rebranding as a kind of greenwashing. Now it will reap what it sowed.
- In a crisis, even companies that are doing a pretty good job of public communication often fail to address the issues squarely on their own websites. BP’s website is better than most on this dimension, with a link to the Joint Information Center (though not to more hostile activist websites). Most impressive: As of May 3, if you go to BP’s home page, www.bp.com, you don’t have to search for the crisis; you are steered automatically to a special oil spill page.
- BP is a good example of the on-again off-again nature of corporate progress in risk communication.
- The company hit a high point with the Huntington Beach spill.
- It hit another when it quit the oil industry Astroturf group that claimed global warming was no big deal, and then-CEO John Browne publicly interpreted this not as leadership but as responsiveness to the zeitgeist.
- It hit a low point when the company admitted (also under Browne’s leadership) overestimating its oil reserves.
- Communication about the Texas City refinery explosion was somewhere in the middle.
- Communication about Deepwater Horizon? It’s too soon to tell, but BP has made a pretty good start.
On May 12, the ISHN website (run by Industrial Safety & Hygiene News) posted a page on my views about BP’s risk communication regarding the Deepwater Horizon spill. It is largely a summary of what’s on this page, but also includes some new comments of mine on why catastrophic risk estimates are far less conservative than chronic risk assessments.
Copyright © 2010 by Peter M. Sandman