Bringing Perspective
Is BP plc a Sustainable Business ?
An assessment of BP plc’s performance in relation to their climate change impact, and their approach towards ensuring both environmental sustainability and corporate survival.
by Jo Abbess
29 April 2010
INTRODUCTION
The Research Question
This piece of research seeks to assess how BP plc is making adaptations in its corporate strategy, in view of the risks to its operations posed by Climate Change policy, and in the context of Peak Oil production and the subsequent inevitable Peak in Natural Gas.
Theories and Propositions
The author of this research has the view that over the course of the next 50 years, due to limits on supplies of good quality fossil fuels, and to avoid the risks of dangerous climate change from global warming, the world economy must de-carbonise, and entirely replace its sources of energy and fuel with low carbon alternatives.
According to this projection, any company that wishes to remain in business should begin their process of total decarbonisation immediately, and will be expected to show evidence for their intentions and procedures for change. This is likely to be particularly difficult for Oil and Gas companies, as their core business is based on energy and fuel resources that must be entirely replaced.
The 50 year timeframe may be beyond the thinking of most political analysts, but is relevant to pension funds, annuity providers and insurance companies. Investors are likely to become more interested in determining the carbon “liabilities” of fossil fuel stocks and shares, and take a risk-averse approach to future stakes in Oil, Gas, Coal and other high carbon fuels.