Corporate Social Responsibility Vital to Industry Operations
Corporate social responsibility (CSR) programs are a critical part of oil and gas project development. As companies continue to work in more densely populated communities, they have become better at working with local authorities to protect the interests of the people their operations affect. However, there is still plenty of work to be done to improve CSR efforts, a group of experts said.
During a panel discussion, representatives from five national and international oil and gas companies discussed the role CSR programs will play in the industry moving forward.
Mary-Grace Anderson, vice president of safety, environment, and social performance at Shell, said that as the global demand for energy increases, CSR will become even more essential to industry operations.
Anderson said operators need to exploit a variety of energy sources to meet the rising global demand, and this need will force them to work more frequently in urban environments. Focusing on CSR will make it easier for operators to mitigate the possibility of unexpected issues happening within these environments, and early engagement with local communities will help build trust and allow them to better share in the benefits of a project.
“In developing projects and in operating our facilities, we need to balance short- and long-term interests,” Anderson said. “Integrating societal and environmental considerations with our technical, operational, and commercial considerations into our project management processes and our business decisions from the earliest stages of our projects … is where we can make the most difference.”
Anderson spoke about the need for further collaboration between operating companies, local communities, and governments, focusing on Shell’s global investment programs. Shell spent approximately USD 160 million on voluntary social investment last year, and a big part of its work was in the development of science, technology, engineering, and mathematical programs for students, parents, and educators. It also has spent more than USD 3 billion on goods and services toward minority- and female-owned businesses in the past 3 years.
“Our intention is to … help each project become sustainable in the long term through collaborative efforts with communities and partners, and this can involve corporations, academia, and regulators. We find the larger the collaboration we can have, typically the better solutions we get,” Anderson said.
Natalie Stirling-Sanders, a global manager of local content, supplier diversity, and sustainable procurement at ExxonMobil, discussed her company’s plan for sharing the benefits of local resources with the local community.
Stirling-Sanders said two of the key elements of developing a CSR program were understanding the needs of the local community and assessing those needs at an early stage. By finding out what the community wants early on in a project, the company can then customize its front-end definition to fit those wants. It is also crucial to maintain a regular flow of information with people in the community and maximize the existing resources.
A well-executed CSR program is not the same as a philanthropic effort, Stirling-Sanders said.
“In a lot of situations the industry finds itself with communities that want more than philanthropy,” she said. “They want jobs, contracts, better infrastructure, and better education. When CSR is done well, there can be a symbiotic relationship between businesses and community.”
Ana Paula Grether presented the outline of Petrobras’ CSR policy. Grether, an adviser in social responsibility guidance and practices with the company, said Petrobras has launched social investment initiatives in select areas of operation that focus primarily on job protection, community relations, and environmental conservation.
Grether said that, through these initiatives, the company created more than 20,000 jobs in the past 8 years and conserved more than 935,000 hectares of wildlife habitat in Brazil, numbers that highlight its goal to improve the communities in which it works.
“For us, social responsibility is a mechanism for integrating management of Petrobras’ business and activities in its relations with our communities,” Grether said.
Geneviève Mouillerat, vice president of global projects and construction at Total, spoke about the work her company has done to support local content on the CLOV project offshore Angola. Mouillerat, who directed the project, said CSR efforts centered on creating shared value for both the country and the company, in part by establishing employee pride in the work being produced.
Training programs are at the heart of Total’s efforts to build value. Mouillerat said the company trained Angolan employees for 2 years before hiring them to work on its floating production, storage, and offloading unit. The company also hired Angolans to work in its fabrication yards at an early stage in the project.
“In-country value is evolving to include the individuals working in the country,” Mouillerat said. “Personally, I’m proud to be part of this challenge and part of this project where we had so many Angolans trained and working on the facilities.”
Paulino Jeronimo, an executive administrator at Sonangol, said that despite these improvements, there is still plenty of work needed to make the local content in Angola more economically viable for the country.
“In terms of quality, we are almost there, but we’re still missing one important point, and that is the pricing. We want to continue working with operators to help become more competitive,” he said.
The panelists each talked about the importance of establishing a clear strategic emphasis during the late stages of a project that accounts for the needs of the local community. Stirling-Sanders said ExxonMobil had developed a system to address the social issues that arise during the shift to the production stage. However, she said communities must be prepared for the economic realities that come with post-project stage work, as the shift to production means the loss of construction jobs typically filled by local content.
“There is a lot of short-term work and lots of construction activity [in the project phase] and, especially for the community, it’s a huge adjustment when you move into production. I think one of the keys is helping all the stakeholders understand that that’s what it looks like from the very beginning and assure that the expectations are understood,” Stirling-Sanders said.
Corporate Social Responsibility Vital to Industry Operations
Stephen Rassenfoss, JPT Emerging Technology Senior Editor
01 July 2015
Opening Session Tackles Economic and Environmental Sustainability
SPE’s annual meeting opened Monday morning with a look at the economic and environmental sustainability of the oil and gas industry.
Southwestern Energy Operations Become Freshwater Neutral
The company makes good on a pledge to reduce freshwater use and replenish the fresh water it uses.
Shell Expands Investments in Solar Energy
Shell invested in a Singapore solar company and signed an agreement to purchase a Texas company with solar and other renewable assets. Along with its minority stake in a company that uses solar to generate steam for EOR in the Middle East, Shell catches some rays in the Asia Pacific, US, and Oman.
Don't miss out on the latest technology delivered to your email weekly. Sign up for the JPT newsletter. If you are not logged in, you will receive a confirmation email that you will need to click on to confirm you want to receive the newsletter.