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BP and the Deepwater Horizon Explosion: Safety First? (Essay Sample)


Please read case 7.5 - BP and the Deepwater Horizon Explosion: Safety First? on pages 427-438 and answer the questions in an essay format


Business Ethics
Discuss in detail the ethical, negligence, and environmental issues you see in this case?
After the oil spill, the workers were cut on expenses through the use of less anticorrosion chemicals in the pipes. For a period of more than a decade, the pipe had not undergone any cleaning. BP’s chief inspector failed to inspect the pipeline, something that can be concluded to be professional negligence. It can also be taken as unethical decision making. When it comes to the environment, the 2003 oil spill had harmed the caribou.
BP had rented the rig from Transocean for $500,000 per day. Transocean had been recognized by the U.S. government for its safety record. Can companies distance themselves from liability and responsibility through the use of contractors?
No. The company cannot shield itself from responsibility only through the presence of the contractor. The workers’ safety is the responsibility of the company. The overall safety of the workplace is also the responsibility of the company, as per the OSHA requirements. A company needs to always have risk management and contingency measures incase of such incidences. Before a contractor is hired, the company’s safety status has to be assessed, and the same needs to be done all throughout the performance of the contract. The use of third parties also has its own risks, such as loss of some vital data, failure to deliver quality work as per the agreed terms, failing to follow up on the required specifications, all of which can impact negatively on the contractor.
Discuss how BP got into the position in which it found itself in late 2006 and what might have prevented the spill, the financial fallout, and the loss of reputation. Be sure to factor in the financial implications of any decision made during the period from 2001 to 2006.
The company’s obsession with cutting down on expenses is what brought them to such a point. This was a situation that would easily have been avoided if the company had chosen to follow on the various recommendations given. Putting pressure on management to cut on costs in whichever way possible, essentially led to them engaging in unethical practices and negligence. Just a little investment in the organizational safety procedures would have done a great deal of avoiding the disaster that happened thereafter. Additionally, employing the services of a third party service provider would also go a long way to avert this.
What was the impact of the emphasis on cost cutting on BP’s culture? What was the impact on the company’s performance?
Due to the increased attention on the need to cut costs or expenses, the employees

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