Saturday, April 09, 2011

Oil Rig Company’s “Safety” Bonuses Generate PR Nightmare

By Stephen Abbott, Abbott PR

It read like a late April Fool’s Day joke. The company investigators say bore a great deal of responsibility for the Deepwater Horizon oil rig disaster that resulted in the most horrific oil spill in history awarded its executives BONUSES for their performance in 2010. For having its “BEST YEAR” for SAFETY.

Yes, it was true. According to the company’s annual proxy statement, which was issued April 1, it had given $19.5 million in bonuses for attaining “115% of its target” for safety in 2010.

The story broke internationally on Monday, April 4, and the ramifications were huge. The company was savaged online, in the print media, and on network and cable news channels for their hubris and audacity, equaled only by the Libyan leader’s creation of an annual “Muammar Gaddafi International Prize for Human Rights.”

The claim was that, other than that huge oil spill (which the company blames on British Petroleum employees) it had leaked very little oil at all last year.

That’s kind of like saying, “other than that iceberg thing at the end, the trip on the Titanic was very safe!”

The bonuses were even more nonsensical considering that in 2009, the company withheld all executive bonuses after incurring four fatalities that year, "to underscore the company's commitment to safety,” reported the Wall Street Journal.

By the following day, the company announced that some of the bonus money would be put into a fund for the 11 who died on the April 20, 2010 explosion when BP’s Macondo well blew out.

But few were satisfied with this concession.

"Some companies just don't get it," said William Reilly, former co-chair of the presidential commission that investigated the disaster. "I think Transocean just doesn't get it."


Sometimes PR people must be the “Jiminy Cricket” of corporate boards, and not only mention what a HORRIFIC PR disaster a move like this would be, but how morally reprehensible it would be, not to mention how inconsistent it would be with past policy.

The continuing failure of corporate America to see public relations as a management function is detrimental, and this is just one more example of that failure.

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