John Browne’s 1997 Stanford University Speech: The “Beyond Petroleum” Beginning (and beginning of the end of BP?)
“Stephen H. Schneider, a climate researcher and Stanford professor who wrote the first popular book on global warming, said [that Browne's] speech was a welcome change of direction for an industry that has, until now, denied that global warming is a problem. ‘They’re out of climate denial,’ Schneider said.”
- Quoted in Glennda Chui, “BP Official Takes Global Warming Seriously,” San Jose Mercury News, May 20, 1997, sec. A. 20.
Then BP CEO John Browne’s speech at Stanford University in May 1997 marked the beginning of the company’s “green” (or to critics, greenwashing) approach to product differentiation and corporate governance. Left environmentalists applauded heartily–and would continue to do so until the Deepwater Horizon accident of April 2010.
Browne’s speech began by begging the question and proceeded to a non sequitur. It begged the question by assuming that anthropogenic global warming was bad and it leapt to the conclusion that corporations and for governments must fight it. In Browne’s make-believe world, there was no such thing as analytic failure or government failure–just market failure.
Today, we know what John Browne did not want to know 13 years ago. We know that the climate is far too complex to pretend to ‘stabilize’ through marginal changes in carbon dioxide (CO2) emissions. We know that government mitigation policies are all pain and no gain. We know that oil, gas, and coal are the real deal–and wind and solar are pretend, press-release energies that might even be CO2 positive.
We also know that the global warming issue resulted in incalculable intellectual fraud, grotesque corporate rent-seeking, and the waste of the environmental dollar (there are real, here-and-now ecological issues that deserve the global warming buck).
We also know, painfully, that BP put form over substance and took their eye off the ball. Beyond Petroleum was a failed corporate strategy that resulted in heedless, dumb cost-cutting that put profits losses ahead of people and the environment.
Reality can be a harsh mistress. BP went after an environmental fad, basked in the glow of the Left environmental movement, and now may have destroyed itself in the process. As with Enron, another ‘progressive’ ‘green’ company, the Left environmentalists got what they deserved.
If only John Browne had given a Lee Raymond-type speech and had conducted BP’s business in the manner of its more reality-grounded brethren. The blame for the fatal attraction goes deep, and it lands at the doorstep of the mainstream environmental movement that got BP into greenwashing.
John Browne’s speech follows verbatim.
The world in which we live is no longer defined by ideology. The old spectrums of left to right and radical to conservative are still with us, but ideology is no longer the ultimate arbiter of analysis and action. Governments, corporations, and individual citizens have all had to redefine their roles in a society no longer divided by an Iron Curtain. A new age demands a fresh perspective on the nature of society and responsibility.
The passing of some of the old divisions reminds us that we are all citizens of one world, and we must take shared responsibility for its future and for its sustainable development. We must do that in all our various roles: as business people with capital to invest, as legislators with the power to make law, as individual citizens with the right to vote, and as consumers with the power of choice.
The global environment is a subject which concerns us in all our various roles and capacities. I believe that we’ve now come to an important moment in our consideration of the environment: the moment when we need to go beyond analysis to seek solutions and to take action. It is a moment for change and for a rethinking of corporate responsibility.
A year ago , the Second Report of the Inter-Governmental Panel on Climate Change (IPCC) was published. That report and the discussion which has continued since its publication shows that there is mounting concern about two stark facts: The concentration of carbon dioxide in the atmosphere is rising. And the temperature of the earth’s surface is increasing.
There’s a lot of noise in the data. It is hard to isolate cause and effect. But there is now an effective consensus among the world’s leading scientists and serious and well-informed people outside the scientific community that there is a discernible human influence on the climate and a link between the concentration of carbon dioxide and the increase in temperature. The prediction of the IPCC is that over the next century temperatures might rise by a further 1 to 3.5 degrees centigrade, and that sea levels might rise by between 15 and 95 centimeters.
Those are wide margins of error, but it would be unwise and potentially dangerous to ignore the mounting concern. The time to consider the policy dimensions of climate change is not when the link between greenhouse gases and climate change is conclusively proven, but when the possibility cannot be discounted and is taken seriously by the society of which we are part.
We in BP have reached that point. We must now focus on what can and what should be done, not because we can be certain climate change is happening, but because the possibility can’t be ignored. If we are all to take responsibility for the future of our planet, then it falls to us to begin to take precautionary action now.
There are two kinds of actions that can be taken. The first would be dramatic, sudden, and surely wrong. Actions which sought, at a stroke, drastically to restrict carbon emissions or even to ban the use of fossil fuels would be unsustainable because they would crash into the realities of economic growth. They would also be seen as discriminatory, above all in the developing world. The second kind of action is that of a journey taken in partnership by all those involved, a step-by-step process involving both action to develop solutions and continuing research that will build knowledge through experience.
BP is committed to this second approach, which matches the agreements reached at Rio based on a balance between the needs of development and environmental protection. The Rio agreements recognize the need for economic development in the developing world. We believe we can contribute to achievement of the right
balance by ensuring that we apply the technical innovations we’re making on a common basis, everywhere in the world. What we propose to do is substantial, real, and measurable. I believe it will make a difference.
Of the world’s total carbon dioxide emissions only a small fraction comes from the activities of human beings, but it is that small fraction that might threaten the equilibrium between the much greater flows. We’ve looked carefully at the precise impact of our own activities. Our operations–in exploration and in refining–produce around 8 megatons of carbon. A further megaton is produced by our chemical operations. If you add to that the carbon produced by the consumption of the products we produce, the total goes up to around 95 megatons. That is just 1 percent of the total carbon dioxide emissions which come from all human activity. Only a fraction of the total emissions comes from the transportation sector, so the problem is not just caused by vehicles. Any response that is going to have a real impact has to look at all the sources.
As a company, our contribution is small, and our actions alone could not resolve the problem. But that does not mean we should do nothing. We have to look at both the way we use energy–to ensure we are working with maximum efficiency–and at how our products are used. It also means contributing to the wider analysis of the problem–through research and technology and through engagement in the search for the best public policy mechanisms, the actions which can produce the right solutions for the long-term common interest.
We have a responsibility to act, and I hope that through our actions we can contribute to the much wider process which is desirable and necessary. BP accepts that responsibility, and we’re therefore taking specific steps:
- to control our own carbon dioxide emissions
- to fund continuing scientific research
- to take initiatives for joint implementation
- to develop alternative fuels for the long term
- and to contribute to the public policy debate in search of wider global answers to the problem.
No company can be really successful unless it is sustainable–unless it has capacity to keep using its skills and to keep growing its business. Of course, that requires a competitive financial performance. But it requires something more, perhaps particularly in the oil industry. The whole industry is growing because world demand is growing. The world now uses almost 73 million barrels of oil a day, 16 percent more than it did 10 years ago. In another 10 years that figure is likely to be more than 85 million barrels a day, and that is a cautious estimate. Some people say it will be more. For efficient, competitive companies, that growth will be very profitable.
But sustainability is about more than profits. Real sustainability is about simultaneously being profitable and responding to the reality and the concerns of the world in which you operate. We’re not separate from the world. It’s our world as well. To be sustainable, companies need a sustainable world. That means a world where the environmental equilibrium is maintained but also a world whose population can enjoy the heat, light, and mobility which we take for granted and which the oil industry helps to provide. I don’t believe those are incompatible goals.
All the actions we’re taking and will take at BP are directed to ensuring that these goals are not incompatible. There are no easy answers. No silver bullets. Just steps on a journey which we should take together because we all have a vital interest in finding the answers. The cultures of politics and of science and of enterprise must work together if we are to match and master the challenges we all face.
The American futurist Francis Fukuyama describes the future in terms of the need for a social order, a network of interdependence which goes beyond the contractual, an order driven by the sense of common human interest. Where that exists, societies thrive. Nowhere is the need for that sort of social order–at the global level–more important than in this area. The achievement of that has to be our common goal.