BP and #IndyRef – the need to constrain corporate influence in our democracy

26 Sep 2014 james
Bob Dudley - CEO of BP
Bob Dudley – CEO of BP

Around about 3.00 am on the morning of Friday 19th September, whilst anxiously watching the results come in on the Scottish Independence Referendum, we heard one of the commentators on STV ‘Scotland Decides’ explain his view that after months of the politicians being unable to help the voters make their decision, ‘business leaders’ had stepped in and clarified things in the very last week on the two year campaign.

This sentiment seems to have underlain a great deal of the reflections on, and reportage of, the Referendum in the mainstream media. But what does this signify? What does it mean that the opinions of non-elected ‘business leaders’ are allowed to come into the public arena and sway the debate more than the opinions of elected politicians?

Lets look a bit closer at what happened between the No Campaign and these ‘business leaders’

We know that David Cameron was having a drinks reception at Downing Street for key figures in business on the evening of Monday 8th September. The timing was particularly tense because of the YouGov poll the previous day had given the Yes campaign a 51% lead. Possibly this had been planned for sometime, perhaps it was hurriedly arranged. We do not know who attended, but the Financial Times reported that:

David Cameron evoked Britain’s defeat of Hitler in the second world war as he spoke to 100 business leaders of the need to fight to keep the UK together… the event was a “call to arms” to save the Union.’

Just 36 hours later, on Wednesday 10th September, BP issued a press release:

 Bob Dudley, BP Group Chief executive said today: “As a major investor in Scotland – now and into the future – BP believes that the future prospects for the North Sea are best served by maintaining the existing capacity and integrity of the United Kingdom.”

Statements from the chief executives of other corporations followed on thick and fast – Shell, Marks & Spencers, Asda and many more. It appears that BP took a key role in leading the pack after Cameron’s speech. And that BP did so as part of a wider geo-political strategy, as we explored in a blog at the time.

But how did BP decide to make this statement? Central to the decision was the CEO Bob Dudley. Possibly he made it in consort with the three other other executive members of the board of BP – Carl-Henric Svanberg, Iain Conn and Dr Brian Gilvray. Perhaps he involved some of the eleven Non-Executive Directors. Doubtless he was assisted by the likes of Andrew Mennear, BP Head of UK Government Affairs, or Richard Bridge, BP Head of Government & Political Affairs, or John Hughes, BP Group Political Advisor.

Of course we will probably never know the truth behind what went on. These discussions took place in a private company, so the ordinary citizen cannot even attempt to get at this information through a Freedom of Information request. (Although our ongoing three year campaign to get the Tate to disclose how much sponsorship they get from BP shows how difficult it can be to get information through FOIA). Pehaps the internal papers of BP will be stored in the BP Archive at the University of Warwick – but access to the archive requires the consent of BP.

Ultimately the decision to issue the statement must have involved two men: Bob Dudley and Carl-Henric Svanberg. They made a decision on ‘behalf of’ the staff of BP (83,900 globally and around 15,000 in the UK) and the shareholders of BP (there are19 billion shares in company held across the world). Of course they did not in anyway consult with the staff and shareholders in this process. They used the ‘block vote’ that they had in their back pocket. Whereas such actions by the democratically elected officers of trades unions have been attacked for the past three decades, the ‘normality’ of a CEO such as Bob Dudley to act in this way is never even discussed.

In that last week of the Referendum, when panic spread through Westminster, there were calls from some quarters that the Queen should speak publically in defence of the unity of her realm, the United Kingdom. There were rumors that Cameron tried to pursuade her. Buckingham Palace issued a public statement on 9th September:

“The sovereign’s constitutional impartiality is an established principle of our democracy and one which the Queen has demonstrated throughout her reign… Any suggestion that the Queen would wish to influence the outcome of the current referendum campaign is categorically wrong. Her Majesty is firmly of the view that this is a matter for the people of Scotland.” 

Part of the reasoning behind this convention is that the Queen is unelected, and she cannot be formally held to account by her ‘subjects’, the citizens of the UK. It is on a similar basis, presumably, that the police, the current heads of the armed forces, the judges and other pillars of the Establishment refrained from making public statements. Of course there are many unelected individuals, political activists, newspaper journalists etc who put their opinions into the public domain, but very few have the sheer political weight that comes with the ‘social power’ of the monarch.

Why then is it deemed acceptable, even normal, that the head of BP should be allowed to make a public declaration on this matter? The CEO has a level of ‘social power’ not dissimilar to the monarch. Why then did BP not keep quiet or issue a statement along similar lines? :

“BP’s impartiality is an established principle of our democracy and one which CEO Bob Dudley is keen to demonstrate…Any suggestion that BP would wish to influence the outcome of the current referendum campaign is categorically wrong. Bob Dudley is firmly of the view that this is a matter for the people of Scotland.” 

Part of BP’s weight in the public debate comes from its name – it’s percieved to be a ‘British’ institution, the closest we have to a national oil company. But BP is barely a ‘British’ company. Of the eleven Non-Executive Directors of BP, only four are British citizens. Less than 40% of its shares are held in the UK, and its presence as an employer in these islands has been in decline since the 1990’s. The amount of oil and gas it extracts from beneath the seas off Scotland has fallen rapidly, as The Guardian recently pointed out: BP’s UK production has fallen from 330,000 barrels a day 10 years ago to just over 60,000 while its gas output has dwindled from 1.1 trillion cubic feet per day to 157m. In comparison BP now obtains from Russia nearly 840,000 barrels of oil a day and 800m cubic feet a day of gas.”

Of course it can be said that despite it’s dwindling position in the North Sea, BP still has a stake in the economic aftermath of the Referendum, just like RBS and the other financial instituions that spoke out. But again the same could be said of the Crown and the British Armed Forces, however we expect them to be silent on “a matter for the people of Scotland.” 

 What is evident is that BP has a huge stake in the maintainence of the existing ‘status quo’. More important to BP than the declining stocks of North Sea oil and gas is the political support that the company extracts from the UK. The British government has invariably come out in support of BP, from Iran in the 1950’s to the USA in the 2010’s. Thus it is in BP’s interests that the British state continues to act a force in geo-politics. Or, to use the phrase, continues to ‘punch above its weight’. The slogan of the No campaign in the last days was that ‘A vote for No is not a vote for the status quo’. However from BP’s point of view they came out for No precisely because they wanted the maintaince of the status quo.

The political entity that we call the UK arose out of the actions of the monarchy through the Union of the Crowns of England, Ireland & Scotland in 1603. This was consolidated by the Acts of Union passed by the Parliament of Scotland and the Parliament of England in1706 and 1707. The MPs who passed these acts, who took these decisions, were unaccountable to all but a tiny percentage of the population of these islands. It was over two hundred years before the enfranchisement of nearly all men and women of Great Britain over the age of 21 came in 1928. It is the result of the long history of popular struggle that both monarch and Parliament have a greater degree of accountablity to the people than they had in previous centuries.

37020-oil-book-reveals-how-the-energy-industry-has-shaped-scotlandWhat the past few weeks has illustrated so clearly is that a corporation such as BP has vast power to influence the lives and direction of a set of countries such as Scotland, England, Wales and Northern Ireland and yet that power is wielded in private and is utterly unaccountable. Friends spoke of how there was outrage on the streets in Scottish cities, from both Yes and No supporters, that the corporations had so blatantly thrown their weight into the public debate. There is much talk of a great reform of the polity of the UK, of new levels of devolution across these isles, and the possibility of some form of constitution. It is vital that in this process the brightest of spotlights is thrown on corporate power and that it is constrained and rolled back. That mechanisms are established to prevent their interference in the democratic processes. This is the coming ‘independence’ struggle.

 With thanks to Mika Minio-Palluelo and Andrew Simms

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