Executive Word -- Level The Playing Field In Politics

Dec. 21, 2004
Sir John Browne, group chief executive of BP PLC, talks with IndustryWeek about having a say in public policy without having to donate money.

Sir John Browne

Group Chief Executive BP PLC, London

Born: 1948

Education: Holds a degree in physics from the University of Cambridge and a master's degree in business from Stanford University. Is a Fellow of the Royal Academy of Engineering, the Institute of Mining and Metallurgy, the Institute of Physics, the Institute of Petroleum, and a Companion of the Institute of Management.

Career Highlights: 1969-1983: Held a variety of exploration and production posts in Anchorage, New York, San Francisco, London and Canada. 1984: Became group treasurer and CEO of BP Finance International. 1986: Became executive vice president and CFO of The Standard Oil Co. in Cleveland. 1987: Appointed CEO of Standard Oil Production Co. 1989: Became managing director and CEO of BP Exploration based in London. 1991: Joined the Board of British Petroleum Co. PLC as a managing director. 1995: Appointed Group Chief Executive of British Petroleum Co. PLC. 1998: Following the merger of BP and Amoco, became Group CEO of BP Amoco. 1998: Knighted at the Queen's Birthday Honours.

Sir John Browne, group chief executive of BP PLC -- the third-largest oil company in the world -- spoke with IndustryWeek Associate Editor Traci Purdum about his company's decision to end all political donations. According to Browne, the decision was a logical and fair move for the London-based company, considering it was making contributions only to the U.S. and Canada.

IW:What led to BP's decision to end political donations?

Browne: Clearly we spent some time thinking about this, and after the acquisitions of Amoco and Arco we found ourselves in a position of making really quite large political donations because of the style of these companies. We concluded, therefore, that we had to align all our staff internally around a philosophy of saying "No, we won't do this." . . .We believe that it's right for us to say what we think about policy, but wrong for us to have any form of partisan political activity. So we concluded the time was right, we aligned ourselves internally, we paid off any obligations that we had genuinely committed to and as of the first of April this year we are no longer making political donations.

IW:How do you think this will affect BP in the future?

Browne: We hope it will not affect us at all. We don't see why it should. We are, after all, a very large taxpayer in the United States. We have 45,000 staff in the United States, and, therefore, I think we can be heard when we need to say something about our business.

IW:What has been the reaction internally from the decision to stop political donations?

Browne: Very positive, indeed. I think the reason why it has been so positive is that we hadn't been making political contributions anywhere else in the world. So the United States and Canada were the exceptions to the rule. It's quite difficult to explain to people in another country why one rule should fit the United States and another rule should fit them. And leveling the playing field internally has gone down very, very well indeed.

IW:Why did BP make contributions in the U.S. and Canada in the first place?

Browne: Partly because everybody did it. And I believe that people had thought that it was an important way of gaining access. Our view is that if this is the only reason that we can gain access, then really it is not a justifiable basis for gaining access. Secondly, our contributions as BP were relatively small. There was a time when BP didn't do any of this actually -- I think way back in the '80s. It was only the acquisition of Amoco and Arco, which made it really quite large. And it was to an extent biased partisan, it wasn't perfectly down the middle. And so it felt to us that this was a partisan act, and BP has no part in partisan politics. It must have a role in saying what it thinks about policy, but that's very different from partisan politics.

IW:Energy companies are skilled at influencing public policy. What would have been the outcome of the National Energy Plan had companies such as Chevron and ExxonMobil not made contributions?

Browne: I can't really answer that question. What I would say is that it is right that companies should say what they think. And to be able to say that public policy will affect them in a certain way. In the end it is the decision makers in public policy that must determine what decisions are to be made. But it would be wrong for anyone to stay silent. This is an entirely different matter than giving political contributions.

IW:Do you think that other companies should follow your example?

Browne: We have a clear view as a company that we are not going to give political contributions anywhere in the world, but other people will obviously make different decisions.

E-mail nominations for Executive Word to Patricia Panchak at [email protected].

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