1

HOW DID BP’S HANDLING OF THE GULF OF MEXICO OIL CRISIS

FROM A PUBLIC RELATIONS PERSPECTIVE

DAMAGE ITS PUBLIC IMAGE?

By Peter Challis1

Abstract

The intention of this dissertation is to evaluate BP’s handling of the Gulf of Mexico oil crisis from a

Public Relations perspective and demonstrate how failures in the corporation’s crisis management

plan led to a decline in its public image. Secondary research was conducted to formulate a timeline of

the corporate crisis and identify the mistakes made by BP when implementing its media response.

This included collecting official press releases made by BP during the crisis and researching public

relations literature to assess the failures made by BP against industry case studies. The crisis

management plan implemented by BP was found to be drastically wrong for three main reasons. (1)

The corporation’s initial reactions towards the Gulf of Mexico crisis failed to represent the uniqueness

of oil crises and could be characterised as being overly optimistic. (2) The corporation implemented a

strategy of aggressively defending an unrealistic estimate of the amount of oil released into the Gulf

per day. (3) The CEO Tony Hayward personally acted as the figure head for BP’s media response

and made various statements in the press that invoked public anger and villainized the company. It is

this dissertation’s aim to show how these three factors as well as others dramatically damaged BP’s

public image, particularly in America.

1 This Dissertation is submitted in part-fulfilment of the degree of, Bachelor of Arts (Honours) in Media and

Communications and Society Nottingham Trent University, April 2012.

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Contents

Abstract ................................................................................................................................................... 1

Acknowledgements ................................................................................................................................. 3

Chapter 1: Introduction ............................................................................................................................ 4

Chapter 2: Background............................................................................................................................ 6

Chapter 3: Initial Reactions ................................................................................................................... 11

Chapter 4: Figures ................................................................................................................................. 15

Chapter 5: Tony Hayward CEO ............................................................................................................. 19

Chapter 6: Affects and Conclusions ...................................................................................................... 24

Appendix A: BP Offers Full Support to Transocean After Drilling Rig Fire (Press Release) ............... 27

Appendix B: Cost of the Gulf of Mexico oil spill ..................................................................................... 28

Bibliography ........................................................................................................................................... 29

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Acknowledgements

I would like to acknowledge the following individuals for their contribution and understanding, without

which this dissertation would not have been possible.

I would like to thank my godfather Julian Samways for giving me the opportunity to work within his PR

agency for a short period of work experience as this greatly influenced the topic of my dissertation.

I also wish to convey my gratitude to David Kidner, my tutor, for the invaluable support he gave me

during the dissertation process.

Finally I wish to thank my parents for their support, especially my father who provided feedback on the

grammar in my dissertation.

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Chapter 1: Introduction

The Gulf of Mexico oil crisis was an oil spill located in the Gulf of Mexico; it is the largest offshore

shore oil spill in U.S history and released 40.3 Million barrels of crude oil into the Gulf for 86 days from

the 20th April to the 15

th July. The crisis caused a huge amount of environmental damage to wildlife

along the Louisiana and Florida coastline affecting local fishing and tourist industries. During the 86

days of the spill it became the biggest news story in the world and certainly in the U.S, at the centre of

the media storm was the corporation behind it; BP2. The corporation’s handling of the crisis from a

public relations perspective has already become infamous and has been cited as one of the worst

handled corporate crises in recent public relations history. “It is already possible to award the BP oil

(The Gulf of Mexico) spill the dubious honour of being the biggest communications disaster in recent

history” (Dahbash and Bidani: 2010). The various failures made by BP in regards to their public

relations response towards the crisis throughout the spring and summer of 2010 positioned the

organisation at the forefront of corporate greed in a hostile public climate following the 2008 Global

financial crisis.

This dissertation will establish the argument that BP’s handling of the Gulf of Mexico oil crisis from a

public relations perspective was fundamentally wrong. This is because BP failed to recognize the size

of the spill and the potential it had to become an international news story. This will be done by

critically analysing BP’s public relations response to the Gulf of Mexico oil crisis and identifying the

various external factors that contributed towards the amount of media attention the spill attracted. As

the crisis is situated within a context of time, this dissertation will be structured to reflect how the crisis

evolved throughout the summer of 2010 to illustrate how BP’s public relations response damaged

their public image.

Chapter 2 will analyse the various external factors that influenced the amount of negative publicity BP

endured as a result of the spill, including an analysis of BP’s level of responsibility for the spill and a

brief history of the corporation.

Chapter 3 will critically analyse BP’s initial assessment of the Gulf of Mexico oil crisis and the

corporation’s initial reactions that aligned it to a strategy of denial.

Chapter 4 will critically analyse BP’s strategy of defending inaccurate figures and the impact this had

on its public image.

Chapter 5 will provide an assessment of BP’s decision to employ Tony Hayward as their

spokesperson for handling the Gulf of Mexico oil spill. This will include an analysis of his background,

the comments he made, and his relationship with President Obama.

Chapter 6 will evaluate and draw conclusions regarding BP’s crisis management plan and the

mistakes they made in reference to previous chapters.

2 BP was not the only corporation at fault for the Gulf of Mexico oil spill. Other corporations involved were

Transocean and Haliburton. However BP was the most publicly criticised in the media.

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To demonstrate BP’s unsuccessful handling of the Gulf of Mexico oil crisis from a public relations

perspective, this dissertation will reference public relation literature, media articles and industry case

studies.

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Chapter 2: Background

The Explosion

It is appropriate to provide a background of the explosion to provide an adequate assessment of BP’s

responsibility for the crisis and how this contributed to the negative publicity they incurred. The Gulf of

Mexico oil spill was the result of a well blow out on board the Deepwater Horizon oil rig on 20th April

2010 at the Macondo prospect located 42 miles southeast off of the Louisiana coastline. The Gulf of

Mexico oil spill has and can also be referred to as the Deepwater Horizon oil spill, the BP oil spill or

the Macondo blow out. However to avoid any issues surrounding political discourse this dissertation

will refer to the crisis as the Gulf of Mexico oil spill. There were three main companies involved in the

drilling of the Macondo prospect that caused the explosion. BP owned the lease and designed the

well and therefore its managers were ultimately in charge of drilling procedures. Transocean owned

the rig and its crew operated the drilling equipment and Halliburton was responsible for cementing the

well which would control the flow of oil to the rig. Although BP’s contractors Transocean and

Halliburton were partially to blame for the explosion that led to the Gulf of Mexico oil spill various

government investigations would determine that BP’s managers were primarily responsible. “This is

because BP decided to use a less costly well design that some Congressional investigators deemed

“risky”. Installation of this design is easier and costs are lower. However, it provides a better path for

gas to rise outside of the pipe. While this did not cause the explosion, investigators believe it may

have contributed to the well’s vulnerability” (Ferrell, Fraedrich and Ferrell: 2011:349). This

demonstrates at least one decision that BP’s managers made that actively contributed to the

vulnerability of the well. This example also illustrates the company’s corporate culture because BP’s

managers on board the Deepwater Horizon were paid bonuses for completing the well quickly and

cheaply and therefore these incentives contributed to the decisions BP managers made that led to

explosion.

Overall, the explosion on the 20th April was the result of a combination of engineering mistakes made

by BP and the failure of Transocean’s blow out preventer (BOP) which is supposed to stop oil and gas

escaping from the well up through the drilling pipe and onto the rig. When the BOP failed and oil

began to hit the deck of the Deepwater Horizon it was only a matter of time before there was an

explosion. The initial blast killed 11 men and the consequent oil spill that followed released 4.9 million

barrels of crude oil into the Gulf of Mexico (210,000,000 Gallons) (RestoreTheGulf.Gov: 2011). The

spill would cost BP 40.9 billion USD in fines and charges (Ferrell, Fraedrich and Ferrell: 2011).

However parallel to the fines and charges BP incurred the corporation faced a huge amount of

negative media attention that significantly damaged its reputation and corporate image. Time.com

ranked the story the biggest of 2010 in the American media (2011) which demonstrates the

magnitude of the task BP and its public relations team faced to emerge from the crisis with as little

damage done to the company’s image and reputation as possible.

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Public Relations

It is essential to provide a definition of the term Public Relations and a summary of its role between

corporations and the public to assess the question “How did BP’s Handling of the Gulf of Mexico oil

crisis from a Public Relations perspective affect its public image”. This is so that BP’s handling of the

Gulf of Mexico oil crisis can be compared against the role of public relations to critically analyse BP’s

response efforts. The field of public relations has been developed to enable corporations,

organisations or individuals to manage their relationship with the public. “Improving public relations for

an individual or an institution is not a matter of using this or that tool or technique to bring about the

desired effect. The total person or institution needs to be brought into a better relationship of

adjustment with the environment upon which he or it depends” (Bernays: 1945:viii). Bernays definition

suggests that the task of good public relations is to align the values of an organisation with the values

of the public, therefore improving the organisation’s image to the public. This has become an integral

part of modern corporate communications because of the expansion of communication technologies

and their increased prominence in everyday life. (Freitag, Stokes: 2009). Today public relations

strategies are used broadly by corporations, organisations and individuals that need to communicate

with the public to enhance profits, brand identity or stock price.

Crisis management has developed as a subsidiary discipline of public relations to help corporations

manage their communications and relationship with the public when faced with a corporate crisis.

Therefore it is an essential area for this dissertation to reference because the Gulf of Mexico oil crisis

is an example of a corporate crisis. Regester and Larkin state that a corporate crisis is “An event

which causes the company to become the subject of widespread, potentially unfavourable, attention

from the international and national media and other groups such as customers, stakeholders,

employees and their families, politicians, trade unionists and environmentalists, who for one reason or

another, have a vested interest in the activities of the organisation” (2008:165). The Gulf of Mexico oil

crisis therefore supports Regester and Larkin’s definition of a corporation crisis because of the huge

amount of global interest the crisis attracted from the media, activists and general public. When faced

with crisis corporations must implement crisis management strategies to resolve, contain and recover

from the event while limiting the damage done to their public image. (Lester et al: 2009). It is the aim

of this dissertation to demonstrate how BP failed to correctly implement a successful crisis

management strategy when handling the Gulf of Mexico oil crisis, and as a result this damaged their

public image.

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The Media

The media is the most important medium used in the field of public relations and especially crisis

management because it can distribute information to a large audience quickly.

“What is collectively referred to as “the media” – Television and radio, newspapers, magazines and in

the twenty first century the internet – are very important to crisis communicators because the media

can quickly disseminate influential messages to mass audiences and also because experienced crisis

communicators can engage the media to actually assist with the crisis communication effort”

(Zaremba: 2010: 26).

Thompson describes the ability to distribute information to a mass audience which produces infinite

amount of recipients as a form of “Mediated Quasi-Interaction” (1995). This means that the media has

become a tool of paramount importance in crisis management. BP failed to communicate their

response message for the Gulf of Mexico oil crisis successfully and in reality their use of the media to

assist their crisis communication effort became fatal.

The process of globalisation has further emphasised the importance of the media in crisis

management. This is because corporations must now manage their relationship with a global public

because globalisation has decreased the importance of local issues in favour of global issues.

Tomlinson (1999) argues that globalisation has created a sense of “Public Intimacy” and “Proximity”

across global audiences. “Proximity might mean that global inequalities are rendered more visible,

that common global risks and threats – most obviously threats to our shared environment – become

more focused, and that an agenda of global responsibility and common interests is established”

(Tomlinson: 1999: 182). Therefore Tomlinson identifies that global issues have become increasingly

important and have created an agenda of global responsibility by which public interest is determined

upon. The Gulf of Mexico oil crisis is an example of a global issue because it contrasted with the

agenda of global responsibility and therefore attracted a huge amount of global interest. This became

hazardous to BP because their global brand was vulnerable to damage from a global public.

Keane (2005) argues that corporation’s reliance on their global brand and public image has made

them increasingly vulnerable to negative publicity. This has meant that corporations must commit to

corporate social responsibility programs3 to demonstrate to an increasingly critical public their ethical

conduct. “Publicity can serve as a reminder to the world that these organisations often violate the

principle of public accountability” (Keane: 2005: 173). In relation to BP and the Gulf of Mexico oil crisis

the significant amount of coverage the spill attracted could have been a result of BP’s failure to

comply with corporate social responsibility. The increasing globalization of media public’s

demonstrates the external forces that could have increased the amount of media coverage the Gulf of

Mexico oil crisis attracted.

3 Visser et al provide a definition of Corporate Social Responsibility (CSR) ““A definition of CSR is that it

encompasses the economic, legal, ethical and discretionary of philanthropic expectations that society has of

organisations at a given point in time” (2010: 122).

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The History of BP

In order to evaluate how BP’s handling of the Gulf of Mexico oil crisis might have had a particularly

strong impact on BP’s public image it is important to include a brief history of BP to understand the

corporation’s history and its relationship with industrial disasters and colonialism. The Anglo-Iranian

oil company (BP) was established in 1909 by Mr D’Arcy following an oil discovery the previous year

(BP: 2012). The company was re-named British Petroleum in 1954 as it sought to expand oil

exploration beyond the Middle East. In1998 BP merged with Amoco America’s 4th largest oil

company and this was followed by a takeover of the Californian oil company Arco for 27 Billion, these

two mergers saw BP take on the status of a multinational corporation. BP’s connection to British

colonial history could have contributed to the intense media scrutiny directed towards the company

during the Gulf of Mexico oil crisis.

In 2001 BP launched “Beyond Petroleum” a marketing campaign which would become the company’s

official name. The move came after BP became the first oil company to publicly acknowledge the

consequences of global warming after a speech given by Sir John Browne (CEO) in 1997 (Petroleum

Economist:2010). The Beyond Petroleum campaign highlighted BP’s investment in green

technologies as part of a growing trend among businesses to appear green and socially responsible.

The “Increasing awareness about climate change and the impact of consumption on future

generations has led to a tipping point on “green issues”, companies are jumping on the green band

wagon” (Davis: 2009: 152). The “tipping point” that Davis refers to is the unique selling point (USP)

that companies use to differentiate their product from their competitors. However in reality the

“Beyond Petroleum” campaign was criticized by environmental advocacy groups as an attempt to

“Green Wash” the corporation because of the discrepancies between BP’s investment in Green

energy and its prominence in its advertising campaigns. “Investments remained relatively tiny: less

than 1 per cent of total capital investment between 1999 and 2005 (Bergin: 2010: 62). The public’s

anger towards BP after the Gulf of Mexico oil crisis could be interpreted as a reaction towards the

discrepancies between BP’s green marketing campaign and their business practice.

In 2005 BP was responsible for an explosion at their Texas City refinery oil which killed 15 workers.

BP was charged with criminal violations of federal government laws and was fined 50.6 million by the

occupational safety and health administration. BP’s image as a socially responsible green corporation

was damaged again in 2006 when one of their pipes burst at Prudhoe Bay, Alaska and released

6,400 barrels (267,000 Gallons) of oil into the ocean. These industrial disasters continued to tarnish

BP’s reputation throughout the 2000’s and as recent as two weeks prior to the Gulf of Mexico oil spill

BP accepted liability for the Texas City explosion and agreed to fines for the disaster. This meant that

on the 20th April when the Deepwater Horizon exploded BP’s terrible industrial disaster record was

fresh in the minds of the American public. However unlike Prudhoe Bay and Texas City, the Gulf of

Mexico oil crisis happened after the 2008 global financial crisis which meant that the public were more

hostile towards corporations. This could have contributed to the huge amount of media and public

criticism that BP became subject to following its involvement in the Gulf of Mexico oil crisis.

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Today, BP is the third largest oil and gas corporation behind Exxon Mobil and Royal Dutch Shell and

is the 4th wealthiest corporation in the FTSE 100 with a market capitalisation of £87.1 Billion (London

Stock Exchange: 2012). It is a vertically integrated company with subsidiaries in exploration, refining

and production spread across the globe. BP’s largest subsidiary is BPAmerica which manages its

interests in the American market primarily in the Gulf of Mexico and Alaska. The importance of BP’s

interests in the American market highlight the corporations need to handle the Gulf of Mexico oil crisis

successfully from a public relations perspective.

In light of BP’s connection with industrial disasters and the hostile public climate towards corporations

in 2010; the Gulf of Mexico oil crisis would become the biggest threat to the company since its

formation in 1909. Therefore it was integral to the corporation’s survival that they implemented a

successful public relations response to the Gulf of Mexico oil crisis. The following chapters of this

dissertation will critically examine BP’s handling of the Gulf of Mexico oil crisis from a public relations

perspective and assess the failures made by the corporation that damaged its corporate image and

reputation.

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Chapter 3: Initial Reactions

The initial reactions of a corporation in a crisis are perhaps the most important aspect of handling a

corporate crisis because they must be correct as once a company has aligned itself to a response

strategy it is hard for a them to change it without intense media criticism. Coombs (1999) argues that

corporation’s initial reactions should be quick, consistent, open, sympathetic4 and informative. This

chapter will analyse BP’s initial reactions and how they affected the corporations handling of the Gulf

of Mexico oil crisis from a PR perspective. BP’s initial reactions towards the Gulf of Mexico oil spill

were quick and consistent however it could be argued that the content of the response was drastically

wrong. Their public relations response would demonstrate a fundamentally inaccurate evaluation of

the nature of the crisis and therefore it could be characterised as overly optimistic. This meant that BP

committed to small scale crisis management strategies in their initial reactions instead of using

strategies that embraced the potential size and scale of the environmental disaster.

To understand the amount of immediate media attention the Gulf of Mexico oil crisis received it is

important to identify the uniqueness of an oil industry corporate crisis. “Oil industry crises are also

unique in terms of magnitude. Explosions have the potential for death and serious injury as well as

significant property damage. However because of the priority oil plays in the national and international

economy and politics, the reach of an oil industry crisis touches many and media attention can be

extraordinary” (Maresh and Williams: 2012). The Gulf of Mexico oil crisis illustrates the potential

magnitude of an oil crises because 11 men died on board the Deepwater Horizon and the global price

of oil per barrel was significantly affected from $84.34 April 19th to $81.52 April 23rd (Energy

Information Administration: 2012). Therefore BP’s initial reactions towards the crisis needed to reflect

the potential the oil crisis had to become an international news story. Instead BP’s initial reactions

would demonstrate an overly optimistic account of the crisis and this is evident in the short sighted

strategies used by BP immediately after the crisis.

The oil industry is also a particularly vulnerable industry to corporate crises this is mainly due to the

industrial nature of extracting oil from increasingly difficult terrain for example deep water offshore

drilling. This means that oil companies like BP should have large permanent crisis management

teams (CMT) for dealing with and preparing for potential crises. “Organisations in industries that

regularly experience disasters or crises usually have an existing CMT. When I say industries that

experience disasters/crisis regularly I am referring to organizations in industries such as chemical, oil,

pharmaceutical, food and airline industries” (Delvin: 2007: 260). In the months leading up to the Gulf

of Mexico oil spill BP had downsized their CMT and therefore had no immediate crisis management

response plan to implement. “No such sound crisis response plan was found at BP. Even in a sector

where the company was most vulnerable to a disaster, a major oil spill, essential crisis planning was

lax” (Atkins: 2010). This left BP vulnerable when the Gulf of Mexico oil spill happened and meant that

BP hired a UK based public relations agency Brunswick. This was another mistake that BP made

because Brunswick had little or no presence in the American market and had no experience in crisis

4 Coombs (1999) argues that corporation’s must be sympathetic towards the victims of the corporate crisis. In

relation the Gulf of Mexico oil crisis this refers to expressing sympathy towards the families of the 11 dead men.

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management. This could perhaps explain the various initial mistakes made by BP when constructing

their initial crisis management response to handle the disaster which significantly damaged BP’s

public image.

BP’s crisis management response plan should have been based on the Exxon Valdez (1989) case

study; the oil spill released 11 million gallons of crude oil into the sea after the Prince William Sound

struck a reef off the coast of Alaska. The corporation was criticised for not taking responsibility for the

spill and not responding quickly enough to the public outrage that was directed towards the company

in the hope the crisis would disappear. “What made it a particularly bad corporate disaster for Exxon

was the way in which the company handled the immediate aftermath. They were slow to react and the

company chairman Lawrence Raul was openly hostile to the media” (Ruff, Aziz: 2003: 78). Therefore

this supports Coombs (2007) argument that corporation’s initial reactions should be quick and open to

media attention, however BP would be criticised for the same mistakes almost two decades later. This

failure by BP to learn from the Exxon Valdez case study and hire a major PR agency with a

substantial CMT demonstrates the complacency of BP’s executives to the possibility of a corporate

disaster especially in light of their previous industrial disaster history and the vulnerability of the oil

industry to potential crises. Both these factors contributed to the crisis management plan BP initially

constructed to deal with the disaster from a public relations perspective and therefore contributed to

the bad handling of the Gulf of Mexico oil crisis which significantly damaged the corporation’s public

image.

Coomb’s (2007) situational crisis communication strategy (SCCT) argues that there are three types of

initial responses corporations can take when responding to a major corporate crises; primary,

secondary and mortification. Primary responses include denial, scapegoating and excuse these

strategies aim to limit the corporation’s perceived involvement in the crisis. Secondary responses

include victimage, and reminding consumers of previous good deeds done by the company, these

strategies try to correct the company’s public image. Mortification is a third set of responses

“consisting of corrective action, repentance and rectification. These strategies are mostly used when

an organization has a history of crises” (Maresh and Williams: 2012: 286). BP failed to apply SCCT

when constructing their crisis management plan for Gulf of Mexico oil spill because they used primary

response strategies including blaming Transocean and denying the amount of oil spilled. These

responses were criticised in the media and caused public outrage that prolonged the corporate crisis

and further damaged their corporate image. Therefore BP should have applied a mortification strategy

for their crisis management plan because they had a previous history of industrial disasters including

the Texas City explosion and Prudhoe Bay oil spill. Coombs would argue that by using mortification

strategies and admitting full responsibility for the spill, implementing safety reforms and releasing

accurate flow rate figures BP could have limited the damage done to their public image.

BP’s primary response strategy was revealed in its first public statement on the crisis on 21st April

through a press release by Tony Hayward and it was titled “BP Offers Full Support to Transocean

after Drilling Rig Fire” (see Appendix A). The title and content of the press release clearly outlined

BP’s response towards the spill which was that this was Transocean’s incident and BP were not

liable. This would be the main response made by BP in regards to the Gulf of Mexico oil spill in the

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coming weeks and Tony Hayward would tell every journalist that would listen that this was

Transocean’s incident. However this was a pivotal early mistake made by BP because although the

rig was owned by Transocean the Deepwater Horizon rig was controlled by BP’s company man who

ultimately controlled the drilling procedures that had caused the explosion. Obama would later

publically criticise BP for blaming Transocean labelling the strategy as a “ridiculous spectacle”

(Reuters: 2010). Therefore BP’s initial PR response to blame Transocean backfired on the company

after public inquires revealed that BP was largely responsible. This was interpreted by the American

public as an attempt to pass blame onto a smaller company and therefore damaged BP’s public

image because they were viewed as dishonest.

The press release also tried to minimize the magnitude of the explosion by labelling the explosion as

a “fire”. This is an example of a corporate damage-control campaign (Dezenhall and Weber: 2008)

and are usually used in small corporate disasters in an attempt to minimalize media attention. This

demonstrates BP’s overly optimistic evaluation of the crisis. After the initial explosion on the 20th April

it was unclear that when the Deepwater Horizon sank if there would be an oil leak underneath. If the

rig had sank and there was no oil leak BP would have been justified in using a damage-control

campaign to limit the exposure of the incident in the press, however on the 22nd April it was revealed

that there were three underwater plumes leaking oil into the Gulf. Therefore BP’s initial use of a

damage-control campaign can be criticised as being overly optimistic because they failed to evaluate

the magnitude of the disaster. This was interpreted by the American public as an attempt to cover up

the size and scale of the disaster and therefore damaged the corporation’s public image.

It could be argued that during the first week of the crisis BP’s damage-control campaign was a

success and there was limited coverage of the spill in the global media, however as the crisis

escalated and BP’s official information was disputed by critic’s cracks started appearing in their crisis

management plan. Dezenhall and Weber (2008) offer a criticism of damage control campaigns and

their effectiveness in hostile social conditions. They use the case study of Coca-Cola in 1999 when

Coca-Cola public image in European markets was damaged when it was reported that Belgium

school children were experiencing dizziness after drinking Coca-Cola. Coca-Cola tried to limit the

exposure surrounding the incident by attributing the dizziness down to coincidence and replaced the

schools stock. However the Belgium and European media reacted furiously and the story became a

national and international news story thus damaging cokes public image. Dezenhall and Weber

(2008) attribute this to underlying social conditions such as globalization and the hostility towards the

dominance of American food companies in European markets. The Gulf of Mexico oil crisis offers a

parallel to this example because BP tried to limit the amount of public interest in the story by

minimizing the magnitude of the crisis to the press. However their efforts attracted more attention and

this could have been because of underlying social conditions such as America’s hostility towards BP

as a British company and America as a former British colony. This is illustrated by various American

media publications reverting back to the name “British Petroleum” when referencing the spill this

clearly labelled BP as an external company to the American public. This increased public anger

towards BP and significantly contributed to the amount of global media attention that was attracted to

the spill, which consequently damaged the corporation’s image.

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The mistakes identified in this chapter regarding BP’s initial reactions following the Gulf of Mexico oil

crisis support the argument that BP handled the crisis badly from a public relations perspective. This

is because BP was not prepared to deal with an industrial crisis the size of the Gulf of Mexico, this is

highlighted by their decision to down-size their crisis management team and failure to apply SCCT

and implement a mortification strategy (Coombs: 2007). Therefore BP’s handling of the Gulf of Mexico

oil crisis from a public relations perspective can be criticised, because given the nature of the oil

industry and BP’s history of industrial disasters they should have been better prepared. As a result

BP’s initial reactions committed them to a strategy of denial which tarnished them as dishonest.

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Chapter 4: Figures

Flow Rate

The second major mistake that BP made when handling the Gulf of Mexico oil crisis from a public

relations perspective was that they failed to determine a realistic estimate for the size and timescale

of the spill. This meant that BP released inaccurate flow rate figures to the media and released

inaccurate deadlines for when the oil plumes would be capped. This made the corporation look

dishonest and incompetent and therefore contributed to the decline of their public image.

The first flow rate figures were released on the 24th of April 4 days after the initial explosion via a

government agency called Unified Command which was made up of BP staff and government

officials. The official figure was 1,000 barrels per day. The figure was extremely low in relation to the

size of the Macondo prospect and it was revealed in January 2012 through a leaked internal email

that BP staff originally estimated the spill could release more than 3.4 million barrels per day. “BP

officials warned in internal e-mails that if the well was not protected by the blow out preventer,

crude oil could burst into the Gulf of Mexico at a rate of 3.4 million gallons a day” (NYtimes: 2012).

These leaked emails demonstrate the conscious decision taken by BP executives to lie to the public

about the official flow rate. Therefore the flow rate BP released was dishonestly low and this set BP

up for a barrage of criticism from scientists and the media. On the 28th April scientists from the

National Oceanic Atmospheric Administration (NOAA) publicly criticised BP’s official estimate arguing

that the figure was probably around 10,000 barrels per day. This immediately created discrepancy

between BP’s figure and the scientists who gave the media an opportunity to criticise BP. Tench and

Yeomas outline that one of the key principles of crisis management is being able to control official

information. “Centralise or at least control information flow: This applies to items of information both

coming in and going out” (2009). BP’s failure to control the flow of information meant that it was

publically criticised by the media and therefore this contributed to the dishonest public image BP were

manufacturing for themselves.

However as Tench and Yeomans (2009) identify this is becoming increasingly difficult since

technological development of the internet has facilitated the expansion of global communications.

“The once limited media market has become global and highly sophisticated. The impact the internet

has on crisis management today is enormous… The totally unregulated nature of the internet thus

gives organisations huge cause for concern. The internet has become the new rumour mill where

people can say anything they want or create websites that criticise specific organisations” (Tench and

Yeomas: 2009: 398). Therefore the emergence of new web technologies has made it harder for

corporations to control the flow of information and control the crisis. This was a problem experienced

by BP when handling the Gulf of Mexico oil crisis because an unofficial twitter account was created

just days after the spill called “BPGlobal_PR” the account had 18,000 followers compared to BP’s

official twitter account that had just 4,000. The unofficial account tweeted negatively about BP. “BP is

doing everything we can to save our reputation and hopefully salvage some oil out of all this. We're

making a ton of shirts and commercials about how we care, and I cleaned an ugly bird yesterday.

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(Twitter: 2010). This demonstrates power that the internet has when reflecting public opinion and the

difficulties corporations face to control the flow of information over the media of the internet.

As the crisis evolved and speculation surrounding the official spill rate increased the US government

ordered BP to release a live video feed of the underwater plume and pictures from its ROVs flying

over the oil slick on the May 1st. This immediately fuelled speculation that the official spill rate could

be far higher than 5,000 barrels per day, throughout May BP dealt with accusations of lying about the

size of the spill in the press. Bob Dudley then managing director of BP gave an interview to MSNBC a

national American news channel in which he accused the media of “scaremongering” ahead of claims

that the flow rate could be as high as 70,000 barrels per day (MSNBC: 2010). This was a huge

mistake in regards to BP’s crisis management plan because Dudley openly criticised the media. This

is another key principle of crisis management identified by Tench and Yeomans (2009) they argue

that corporations must at all costs avoid the instinct to combat the media because corporations must

show they are in control of the crisis at all times. Also the interests of the media are meant to be

reflective of the interests of the public and therefore Bob Dudleys criticism of media interest attacked

the public’s interest in the story. This supports the argument that BP’s aggressive defence of an

unrealistic flow rate damaged the corporation’s public image as Bob Dudleys actions on MSNBC

directly angered the general public and directly attracted more media interest towards the Gulf of

Mexico oil spill.

The official flow rate was decided at 20,000 on June 11th by the Flow Rate Technical Group (FRTG)

an organisation set up by the US government to determine the official flow rate against claims made

by BP. The overwhelming difference between BP’s initial figures and the findings of the FRTG

reinforced the public opinion that the corporation was dishonest and didn’t care about their

responsibilities towards the environment. This created what Dezenhall and Weber (2008) term a

“Character Crisis” – they use the Exxon Valdez crisis (1989) to define the damage a character crisis

can have on a corporations public image.

“What the company had acquired was what we call a “character crisis” which is when the very moral

fibre of the company – not just the events surrounding the crisis – comes into question and once a

company’s or individual’s character is in doubt- and the motivations behind its actions or inactions are

reviled – it transforms into an “allegation magnet” (Dezenhall and Weber:2008: 147).

The status of a “character crisis” therefore could be applied to BP when describing their handling of

the Gulf of Mexico oil crisis especially in regards to the communication of the official flow rate in the

media. This is because after it was revealed that the company had released inaccurate flow rate

figures the media speculated as to why. It was largely assumed by the global media that BP had

down played the official flow rate to limit the fines that would be imposed on it by the US government.

Carol Browner a white house energy adviser stated on CBS the American Television Network that “It

is important to understand that BP has a financial interest in what those flow rates are. They will

ultimately pay a fine based on those rates” (Geman and Needham: 2010). This fuelled the debate that

BP had intentionally lied about the flow rate and made the company become an allegation magnet for

corporate irresponsibility. This supports the argument that BP’s strategy of aggressively defending an

17

unrealistic time estimate contributed to the damage dealt to their public image because the company

was accused of caring about finances ahead of public interest.

Time scale

The second figure that BP failed to accurately calculate was a realistic deadline for when the well

could be capped. This highlights a failure by BP to communicate between their engineering

department that was in charge of capping the well and the CMT which was assigned to communicate

with the public. “Good internal communications is vital as an underpinning to the success of an

organisations communications overall” (Harrison: 2000: 116). The failure by BP to internally

communicate a realistic deadline for when the well would be capped meant that their CMT released

unrealistic timescale estimates which undermined the corporation’s control of the crisis. This created

the image that BP was incompetent and didn’t care about their commitments to their social

responsibility program.

On May 7th BP released a press release stating that 125-tonne containment dome had been lowered

over the largest plume to minimize the amount of oil that was being released into the Gulf. This was

concluded a failure the next day and therefore undermined BP’s engineering expertise and fuelled

speculation that this could have been the cause of the explosion. The most controversial plan to cap

the well was BP’s “Junk Shot” or “Top Kill” strategy which consisted of pushing mud and debris down

the wellhead to block it. On May 26th Doug Suttles the BP executive in charge of the spill response

announced the strategy at a press conference (Resnick-Ault: 2010). BP’s handling of the Gulf of

Mexico oil crisis can be criticised because Doug Suttles decision to announce the optimistic strategy

left BP vulnerable to criticism. Corporations must prepare for the worst case scenario when handling

a corporate crisis this is demonstrated by Johnson & Johnson’s handling of allegations that their

product Tylenol had been contaminated by cyanide. The drug corporation prepared for the worst case

scenario and recalled the product immediately, this meant they were prepared to handle criticism if

the allegation was correct. BP’s decision to announce the “Top Kill” strategy demonstrates a failure to

prepare for the worst case scenario and therefore supports the argument that BP failed to assess the

potential size of the spill.

This was a major flaw in BP’s public relations response because it committed to the success of the

strategy publically and this attracted a huge amount of global media attention. “Junk shot” was

officially declared a failure on the 29th of May this caused intense public anger towards the

corporation.

The failure of “Top Kill” caused immense public anger across America as Bergin notes that after the

failure of Top Kill “The US public understandably thought the crisis had already dragged on for too

long…The response to this realisation was the kind of national rage one might associate with the

outbreak of war” (185: 2010). Bergin identifies that the amount of national rage that the failure of Top

Kill caused was similar to the amount in the event of war; this could have been because the American

public viewed the spill as an attack on America. Therefore the failure of Top Kill created a sense of

immediacy surrounding the crisis as the public became increasingly impatient with BP’s efforts to cap

18

the well. This significantly damaged BP’s public image because they were seen as an enemy the

enemy of America and publicised the damage corporations have on the environment.

In conclusion, the crisis management strategy implemented by BP to aggressively defend an

unrealistic flow rate and over-optimistic deadline for when the well would be capped undermined the

corporation’s credibility and trust with the public. This contradicts Williams and Threadway’s key

principle of crisis management that corporation’s must demonstrate honesty and commitment to

solving a crisis. “Honesty openness about the crisis along with evidence of sincere attempts by the

organisation to resolve it are the key to establishing or enhancing credibility with the press or the

public”. (Williams and Threadway cited in Zaremba: 2010: 28). This shows how BP’s failure to provide

open and honest figures and its failure to provide evidence of sincere attempts to cap the well

undermined its attempts its credibility to the public. Read states that “These underestimates of

potential damage, even if BP acknowledged it was a serious spill, were indicative of a firm unprepared

for a spill of a scale never before remediated” (2011:162). This supports the argument that BP did not

recognize the potential size of the Gulf of Mexico oil crisis and as a result their strategy of denial

tarnished their public image as dishonest and incompetent.

19

Chapter 5: Tony Hayward CEO

Tony Hayward’s prominence in BP’s public relations response was the third fundamental mistake

made by BP that contributed to their unsuccessful handling of the Gulf of Mexico oil crisis from a

public relations perspective. The CEO personally acted as the figure head of BP’s media response

and therefore embodied the identity of the corporation which made his views and comments

inseparable from BP’s. This became hazardous to the company’s public image after he made

numerous comments in the media that were interpreted by the public as being selfish, un-caring and

unemotional. This chapter will promote the argument that BP were excessively loyal to Tony Hayward

and as a result this damaged the corporations public image.

It is important to provide a brief analysis of Tony Hayward’s background to understand how he

became the talisman for BP’s media response and how his characteristics personified the

corporation’s response to the Gulf of Mexico oil crisis for the American public. He was born in

Buckinghamshire, England and graduated from Aston University with a degree in Geology and

achieved a PhD from the University of Edinburgh in geological science. He rose through the ranks at

BP through various roles in exploration and became an executive assistant to Lord Browne’s (former-

CEO). In 1997 he became head of exploration and throughout the 00s he climbed the corporate ranks

in BP through various stints as group treasurer and executive vice president. He eventually became

CEO on 12 January 2007 after the retirement of the previous CEO and his mentor Lord Browne. Tony

Hayward’s background and history with BP would present multiple reasons for why he shouldn’t have

taken such a focal role in BP’s public relations response to the Gulf of Mexico oil crisis which

damaged BP’s public image.

Firstly, his traditional upper-middle class British accent meant that his identity re-enforced BP’s

historical relationship with British imperialism as noted in the sub chapter “The History of BP” and this

could explain why the American public were so openly hostile towards him. Democratic congressman

Anthony Weiner stated on the 8th June 2010 that “Whenever you hear someone with a British accent

talking about this (The Gulf of Mexico oil crisis) on behalf of British Petroleum they are not telling you

the truth. That’s the bottom-line” (Guardian: 2010). This statement combined with a wave of anti-

British sentiment in the American media during the spill summarises how Hayward’s British identity

became attached to the public image of BP and portrayed the corporation as un-trustworthy.

Falkheimer and Heide (2012) argue that an organisation’s existing Trust Capital is essential for

conducting successful crisis communications. “An interrelated problem is that people’s trust in

institutions in society, both in general and in historical terms, has become somewhat weaker.

Companies and authorities quite simply have to have Trust Capital before a crisis in order to be

listened to during a crisis (Falkheimer and Heide: 517: 2012). They argue that it is increasingly hard

for corporations to instil trust within an increasingly sceptical public this supports the argument in the

chapter “history of BP” that this is a result of the 2008 global financial crisis. Therefore it is evident

that Tony Hayward’s mannerisms reduced BP’s Trust Capital because he re-enforced BP’s historical

relationship with British colonialism and Industrial disasters in an already weaker climate of public

trust. This is supported by Anthony Wiener’s comments and demonstrates why BP should not have

20

used Tony Hayward to represent the company during the Gulf of Mexico oil crisis. Instead they should

have used someone that the public could relate to which would have rebuilt public Trust Capital.

Secondly, Hayward’s background as a geologist meant that he had little or no experience when

dealing with the media and this meant that he was unprepared to deal with the intense media

attention that he attracted throughout the crisis. Although The Exxon Valdez (1989) case study

dictates that CEO’s must respond quickly to send out a clear message to the public and that the crisis

must feature highly on the organisations priorities as stated in “Initial Reactions”. However it is not

necessarily essential that the CEO remains at the head of the media response campaign. “If the CEO

is not normally the spokesperson outside of a crisis then he or she is probably not the right person in

a crisis. Let us not forget that whoever is the standard spokesperson for a company will have an

existing relationship with the press (Anthonissen: 31: 2008). Therefore considering the lack of

experience Tony Hayward had in media relations BP should have instructed someone more

experienced, with an existing relationship with the press. The decision by BP’s crisis management

team to allow Tony Hayward to become the voice of BP’s public relations response was therefore

fundamentally flawed and left BP vulnerable to the PR blunders that Tony Hayward would make over

the course of the crisis. These comments would make Tony Hayward the most hated man in America

(NYDailyNews: 2010) and the iconic symbol of BP’s terrible public relations campaign this would

ultimately damage the corporations most important asset its public image and reputation and cost

Tony Hayward his job. This supports the argument that BP were excessively loyal to Tony Hayward

because they should have fired the CEO sooner.

The intense media pressure that was placed on Tony Hayward during the Gulf of Mexico oil crisis

could have been a result of the media’s need to create a villain. As Dezenhall and Weber (2011)

argue the media actively pursue two duelling narratives when reporting on organisational crises which

they juxtapose against each other to sensationalise the event and increase public interest. “The

media pursue two duelling narratives in organisational crises: the victim’s plight and the tale of an

embattled CEO. A vulnerable victim pitted against an arrogant or incompetent villain –are inevitably

polarized to fit the prefabricated format that the mass audience can process” (Dezenhall and Weber:

2011: 39). This analysis of the media’s editorial agenda when reporting on organisational crisis is

supported by the case study of Hurricane Katrina. The media contrasted tales of New Orleans

civilians against the incompetency of the U.S government to respond to the crisis quickly which was

represented by President George Bush. Therefore Denzenhall and Weber’s duel narrative theory

(2011) might help to explain why Tony Hayward became an immediate target for media and therefore

BP’s CMT should have recognised this and limited his freedom to speak to the press. This failure

demonstrates how BP’s handling of the Gulf of Mexico oil crisis directly damaged its public image.

Tony Hayward’s negative relationship with the media was initiated by reports from The New York

Times on the 29th April that claimed when he heard the news of the explosion on board the

Deepwater Horizon he turned to colleagues and said “What the hell did we do to deserve this?”

(NYtimes: 2010). Although these comments were only alleged, the article introduced the public to

Tony Hayward and positioned him as the voice and identity of the company. These comments were

interpreted as self-pity by the American public and demonstrated a fundamental mist-understanding of

21

BP’s involvement in the crisis. This shows how Tony Hayward became the identity of BP from an early

stage and therefore connected his arrogant mentality to the corporate image of BP.

On the 13th of May Tony Hayward spoke to the Guardian in a formal interview. The decision to take

an interview with the British paper was taken by Andrew Gower’s BP’s media representative and head

of Brunswick communications probably because of the existing media relationship he had with the

British newspaper. However this demonstrated a lack of interest by BP to address the American

public and caused enormous public anger because it was interpreted that BP didn’t care about the

public it had effected. The interview itself was a disaster as Hayward speculated on his role as CEO

and claimed the oil spill was “relatively tiny” compared with the “very big ocean” (Guardian: 2010).

These comments infuriated the American public because they were patronising and unsympathetic

towards the damage done to the Louisiana coastline and attracted more attention towards the crisis.

This conflicts with Lester et al’s (2009) theory that crisis management strategies should be used to

contain a crisis while limiting the damage done to the company’s public image. Therefore this

supports the argument that Tony Hayward’s role as head of BP’s public relations response invoked

public anger and villianized the corporation and damaged their public image as a result.

The pinnacle of Tony Hayward’s infamy came after he stated on American television on the 31st of

May “I’m sorry. We’re sorry for the massive disruption it’s caused their lives. There’s no one who

wants this over more than I do. I’d like my life back” (Huffingtonpost: 2010). These comments invoked

public anger towards Tony Hayward because it inferred he was only cared about himself. “Witness

the BP CEO’s now infamous comment “I want my life back” which displayed a concern for his own

personal circumstances at a time when others livelihoods were being destroyed by a massive

environmental disaster” (Smith and Zook: 2011:333). These comments were contrasted in the media

against images of the impact the oil was having on wildlife and local fishing industries and therefore

further supported the media narrative of Villain vs. Victims as identified by Dezenhall and Weber

(2011). Tony Hayward’s comments summarized BP’s public relations response as Roger’s analysed

“he came across as overly defensive and unemotional, playing into the hands of aggressive US

journalists” (Rogers cited in Smith and Zook: 2011:333). His overly defensive persona correlates with

BP’s overly aggressive defence of their official flow rate figure which as identified earlier made the

corporation look dishonest. Hayward’s unemotional characteristic correlated to BP’s image as a

corporation that was only interested in profits which is supported by the lapse of safety regulations

that caused the spill. Therefore the characteristics Roger’s identifies combined with Hayward’s

English accent meant that he personified the corporation for the American public.

As Roger’s acknowledges after Hayward’s “I want my life back” comment his character came into

question in the American press. In response BP enacted a Corporate Apologia strategy (Hearit: 2006)

which are used to defend a corporation’s reputation when a person’s character is called in question

(Coomb’s: 2012). BP chose to communicate this strategy on American primetime television and

featured Hayward apologising for his comments and the environmental damage the spill had caused.

Hearit (2006) argues that Corporate Apologia strategies need to be truthful, sincere, timely, voluntary,

address all stakeholders, and performed in an appropriate context. The Corporate Apologia campaign

that BP enacted failed because of two failures to meet the characteristics identified by Hearit. (1) The

22

campaign was not timely because it followed immediately after Hayward’s “I want my life back”

comment and was interpreted by the American public as the result of external pressure. (2) The

apology was delivered by Tony Hayward and as a result was heavily criticised for not being sincere

because he did not show any emotion which supports Roger’s analysis of Hayward “Apologia is as

character-based defence and success largely depends on the persona of the spokesperson” (Hearit:

1994: 287). These two failures by BP invited a wave of criticism from the public, media and

government, most notably President Obama who criticised the campaign because it had cost BP 50

million USD which was more than the corporation had compensated victims to date. Therefore this

was supported BP’s emerging public image that the corporation only cared about the effect the spill

had on itself.

Politics

Tony Hayward’s emergence as the villain of the Gulf of Mexico oil crisis put an enormous amount of

pressure on newly elected president Obama. The intense public anger directed at BP placed

enormous pressure on President Obama to punish BP and protect his own public image. However he

also knew he needed BP to stimulate growth and investment in the American economy by advocating

offshore drilling. Throughout the crisis Hayward’s negative actions were contrasted in the media

against the positive actions of president Obama, thus criticising BP as an enemy of the American

people.

Atkins (2012) acknowledges that a corporate crisis often affects more than one organisation and that

the decisions made by other organisations can have consequences for a corporation’s crisis

management plan. Atkins cites the case study of Hurricane Katrina to demonstrate how multiple

organisations or individuals can be affected by a crisis during Hurricane Karina, where the involved

bodies included President Bush, the State of Louisiana Government and the Federal Emergency

Management Administration (FEMA). These organisations were all criticised for their response but

ultimately President Bush received the majority of the criticism Atkins (2012) argues that Bush did not

“reframe the assignment of responsibility for the crisis onto another entity” (109) therefore he became

the focus of public anger. In relation to BP and the Gulf of Mexico oil crisis besides BP the other

entities subject to criticism for the spill were, Halliburton, Transocean, the Louisiana Coast guard and

President Obama. However in contrast to Bush’s response to Hurricane Katrina President Obama

responded to initial criticism by reframing the assignment of responsibility.

President Obama criticised BP openly in the American media and immediately placed a ban on

offshore drilling activity following the Gulf of Mexico oil spill. Obama’s tough approach towards BP

could be interpreted as his attempt to reframe the assignment of responsibility and protect his own

public image. It also demonstrated to the American people his resistance to tans-national oil

corporations which was something that his predecessor President Bush has been heavily criticised

for. This supports the argument that Hayward’s villanization of BP in the media forced Obama to take

a tough approach with BP and as a result this further damaged the corporation’s public image.

23

Therefore it is evident that the decision taken by BP to place Tony Hayward at the front of their public

relations response directly damaged the corporation’s public image. He embodied the corporation as

his background and personality aligned his identity to the public’s view of the corporation as an

uncaring British mega-corporation. Therefore he personified BP throughout the crisis and this became

hazardous to the corporation’s public image after he made numerous inappropriate comments in the

press. This invoked public anger towards BP and positioned Hayward as the villain of the Gulf of

Mexico and as a consequence increased the amount of coverage surrounding the spill. This supports

the argument that Hayward’s role as the spokesperson for BP throughout the crisis invoked public

anger and villanized the corporation. This supports the argument that BP were excessively loyal to

Tony Hayward because they failed to fire him after public sentiment demanded it, consequently this

portrayed BP as un-caring.

24

Chapter 6: Affects and Conclusions

Affects

BP’s involvement in the Gulf of Mexico oil crisis as the main responsible party inevitably meant they

would face a variety of consequences. However it could be argued that BP’s unsuccessful handling of

the Gulf of Mexico oil spill that has been identified in chapters 3, 4, and 5 dramatically contributed to

the severity of these consequences. BP suffered huge financial losses in the months following the

Gulf of Mexico oil spill; before the crisis the corporation’s global market value had been 122 billion

(USD) and after the crisis it was reduced to 80 billion (USD). Besides, the enormous devaluation of

BP’s market value the corporation was subject to a variety of governmental and state fines (see

Appendix B). These financial effects demonstrate the disastrous implications a poor handled

corporate crisis can have on an organization. In relation to the oil industry the US Government

imposed a 6 month moratorium on deep-water offshore drilling and issued a conduct report of the

controversial practice.

Fombrun (1998) argues that the financial damage a corporation suffers can constitute the markets

best guess about the damage inflicted to a corporation’s reputational capital. He suggests that drop in

a corporations market value can indicate a loss in a corporations reputational capital. Therefore BP’s

loss of around a third of its market value indicates the substantial damage the corporation’s handling

of the Gulf of Mexico oil crisis from a public relations perspective had on their reputational capital.

Reputational capital is integral to supporting a corporation’s public image as Vos and Schoemaker

(2006) identify it is hard to differentiate between the terms “reputation and image” because they are

both concerned with the relevance of the public’s perception of the organisation. Therefore it could be

argued that the decline in BP’s reputation facilitated the decline of BP’s public image which supports

the argument that BP’s handling of the Gulf of Mexico oil crisis damaged their public image.

The damage BP inflicted on their public image was monumental; it has been ranked the worst

corporate image catastrophe ever by Investopedia (Investopedia: 2010). In the years before the crisis

BP had transformed its public image into an environmentally “friendly” oil corporation. “BP has spent

heavily to position itself as an environmentally friendly company, redesigning its logo into a green-

and-yellow sunburst and advertising its $4-billion alternative-energy push to move beyond petroleum"

(White: 2010). However BP’s actions regarding the Gulf of Mexico oil crisis undermined their

marketing campaign and commitment to environmentally friendly business. Therefore this could be

interpreted as directly damaging the corporation’s public image because it fuelled criticism from

environmental advocacy groups that BP had green washed the public. As a result BP became the

target of Greenpeace’s rebrand BP campaign5 and numerous global consumer boycotts which further

5 Greenpeace launched a campaign against BP to re-brand the corporation “British Polluters” and on 20th May

2010 hundreds of activists demonstrated outside BP’s headquarters at St. James Square

25

damaged their public image. This supports the argument that BP’s unsuccessful public relations

campaign damaged their global brand, reputation and most substantially their public image.

Conclusions

In conclusion, it is evident that the mistakes identified in chapters 2, 3, 4 and 5 support the argument

that BP handled the Gulf of Mexico oil crisis badly from a public relations perspective. This is because

the crisis management plan that BP implemented was fundamentally wrong because it did not

recognize the magnitude of the spill and the potential it had to become a global news story. This is

illustrated by the three main mistakes BP made when handling the Gulf of Mexico oil crisis from a

public relations perspective.

1) BP was not prepared to handle a major environmental disaster; this is highlighted by their

decisions to down-size their CMT prior to the disaster and their failure to apply SCCT and

implement a mortification strategy (Coombs: 2007). This supports the argument that BP did

not recognize the potential size of the spill because their actions were characteristic of

handling a small scale crisis. This mistake directly damaged BP’s public image because it

aligned BP to a strategy of denial which damaged the corporation’s public image as

dishonest.

2) BP did not evaluate the amount of public criticism the Gulf of Mexico oil crisis would attract;

this is demonstrated by their decision to aggressively defend inaccurate figures. This supports

the argument that BP didn’t recognize the potential size of the spill because they failed to

evaluate the criticism the figures would attract. This mistake directly damaged BP’s public

image because it portrayed BP as dishonest and incompetent.

3) BP was excessively loyal to Tony Hayward; this is highlighted by their commitment to

Hayward as their spokesperson regardless of his inexperience in media relations and the

inappropriate comments he made. This supports the argument that BP didn’t recognize the

potential size of the spill because they didn’t accommodate for the intense media scrutiny his

comments would attract. This mistake directly damaged BP’s public image because Hayward

personified the corporation and portrayed the company as un-emotional and un-caring.

It is evident that these three mistakes transformed BP’s public image from an environmentally

conscious corporation to an un-caring, incompetent, profit driven corporation. This is because these

mistakes demonstrated a commitment to the interests of BP over the interests of the public. This is

an example of bad public relations because as Bernay’s (1952) definition identified in chapter one

suggests the task of public relations is to align an organisation’s values to the values of the public.

BP’s public relations response to the Gulf of Mexico oil crisis can be criticised because their actions

contrasted from the values of the public by not portraying the corporation as caring, competent and

socially responsible. Therefore it can be argued that BP’s handling of the Gulf of Mexico oil crisis

represents bad public relations. “This has to be one of the all-time worst disasters for corporate

reputation. The most graceful course of action for BP would be to hang its head for a very long time

and admit it has some deep issues to deal with” (Taipel Times: 2010). This could have led to the

26

corporation being voted the most hated corporation in America during 2010 on the Consumerist.com

(2011).

BP’s unsuccessful handling of the Gulf of Mexico oil crisis could have been a result of its previous

history with industrial disasters. It could be interpreted that during the years prior to the Gulf of Mexico

oil crisis, BP had become ignorant to the damage a corporate crisis could have on its public image

and reputation. This could be because the corporation had sustained little damage to their public

image following the disasters at Prudhoe Bay and Texas City. However the Gulf of Mexico oil crisis

presented a different breed of crisis from Prudhoe Bay and Texas City for two reasons.

1) The Gulf of Mexico oil crisis was an on-going crisis and therefore presented the potential to

escalate, which it evidently did as a result of the public relations mistakes BP made.

2) The Gulf of Mexico happened after the global financial crisis (2008). It could be argued that

the public climate was more hostile towards corporations following the involvement of

corporations like Goldman Sachs in the crisis (The guardian: 2010).

These two factors illustrate the inability of BP to correctly assess the potential the Gulf of Mexico had

to become an international news story. Therefore as a result of this failure the crisis became one of

the biggest international news stories of 2010 and attracted enormous negative publicity towards BP.

In conclusion, the Gulf of Mexico oil crisis is one of the worst corporate crises in recent history.

Through an analysis of the crisis management plan that BP implemented, this dissertation has proven

that BP’s handling of the Gulf of Mexico oil crisis from a public relations perspective significantly

damaged its public image.

In a wider context, the field of public relations has emerged as an essential department for

corporations to invest in; the role of the department is arguably to disguise the effects of corporations

on the planet and on human life by promoting their commitments to social responsibility programs.

Therefore BP and the Gulf of Mexico oil crisis could provide an example of the damage faced by

corporations when the effects of capitalism are made visible to the public.

27

Appendix A: BP Offers Full Support to Transocean After Drilling Rig Fire

(Press Release)

Release date: 21 April 2010

BP today offered its full support to drilling contractor Transocean Ltd. and its employees after fire

caused Transocean's semisubmersible drilling rig Deepwater Horizon to be evacuated overnight,

saying it stood ready to assist in any way in responding to the incident.

Group Chief Executive Tony Hayward said: "Our concern and thoughts are with the rig personnel and

their families. We are also very focused on providing every possible assistance in the effort to deal

with the consequences of the incident."

BP, which operates the licence on which Transocean's rig was drilling an exploration well, said it was

working closely with Transocean and the U.S. Coast Guard, which is leading the emergency

response, and had been offering its help - including logistical support.

Transocean reported the fire earlier today on the rig, located approximately 41 miles offshore

Louisiana on Mississippi Canyon block 252, saying that a "substantial majority" of the 126 personnel

on board were safe, but some crew members remained unaccounted for. A number of personnel were

reported to be injured.

BP “BP Offer Full Support to Transocean After Drilling Rig Fire” (2010) [online] Available at:

http://www.bp.com/genericarticle.do?categoryId=2012968&contentId=7061458 Accessed 08/02/2012

28

Appendix B: Cost of the Gulf of Mexico oil spill

Description of costs Already paid

(USD)

Potential cost

(USD)

plugging and cleaning the oil spill 10.7 Billion Not clear Yet

Gulf Coast Claims Facility fund for individuals and

private businesses that were affected by the spill.

2.7 Billion 20.0 Billion

Violation of Clean Water Act, fined by the US Justice

Department.

5.4 Billion 21.0 Billion

Legal fees for additional lawyers and technical experts Not clear yet 2.0 Billion

Lawsuits resulting from claims of fishing, tourism and

real estate industry, and region and state departments.

Not clear yet 6.0 Billion

Total 18.8 Billion 49.1 Billion

S. Korteweg (2011) "The 2010 Gulf of Mexico Oil Crisis: Evaluating shareholder value and reputation"

[online] Eramus Universiteit Rotterdam : Netherlands Avalible at:

http://oaithesis.eur.nl/ir/repub/asset/9156/Master%20Thesis%20Sebastian%20Korteweg.pdf

[Accessed 25/04/2012]

29

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