I've been depressed by the ongoing disaster of BPs' oil spill in the Gulf of Mexico. Twelve people lost their lives in the inital explosion, and the ongoing leak is causing huge damage to wildlife, environment, and local businesses. Another casualty seems to be the credibility of corporate social responisblity accounting, as senators and commentators in US seem to suggest that BP has paid only lip service to its CSR obligations.
They've accused BP of understating the flow of oil (the data on which its future fines will be paid); controlling the flow of information (including access to the images of the deep water leak); criminally misrepresenting its ability to cope with the spill and prioritising the interests of shareholders ahead of stopping the leak - the implication being I guess that BP has some solution in the wings which it is unwiling to deploy because it is too costly. Would that it had a sure-fire solution. But it has to be in shareholders' interests for BP to devote maximum effort to stopping the leak and minimising damage. The disaster so far has wiped a third off its market capitalisation; and BP will be liable for significant damages and clean-up costs (note the recent proposal to raise the cap on economic damages from oil spills from $75m to $10bn).
BP employs dedicated CSR specialists, collect and report data on its environmental and social obligations. It's probably even won awards. It would be hugely depressing to think that none of that makes a difference, that there is a culture in BP - and if so, why not in many other large corporates? - that in reality serves only the short-term economic interests of shareholders. I wonder if the shift away from institutional shareholders to those with arguably a shorter-term perspective is an influence?