Ambassador Edward P. Djerejian, member of the Board of Directors, shares his perspectives on social responsibility at Oxy.
As Chair of Oxy’s Corporate Governance, Nominating and Social Responsibility Committee, how do you characterize social responsibility at Oxy?
Corporate Social Responsibility (SR) integrates Oxy’s commitments to integrity and respect for human rights, safety and the environment into its corporate governance and business model, beginning with the Board of Directors and senior management and extending to all employees throughout the company’s global operations. SR is dynamic and evolving in our globalized world. SR has long been a part of Oxy’s corporate culture, and it has now become mainstream at many other American companies. Successful companies such as Oxy make important contributions to society by producing essential products, creating jobs, promoting economic growth and advancing people’s general welfare. Oxy recognizes its responsibilities to the environment and the social and economic development of the communities where it operates, and Oxy’s SR Program unifies these responsibilities.
What is the role of the Board relative to Oxy’s Social Responsibility Program?
The Board has been actively engaged in Oxy’s SR efforts for many years. Oxy endorsed the Global Sullivan Principles and the Voluntary Principles on Security and Human Rights in 2000 and 2003, respectively. In 2004, Oxy adopted the Human Rights Policy, becoming one of the first American companies in the oil and gas industry to issue a specific policy on this essential topic. At the same time, the Board assigned oversight of the SR Program to the renamed Corporate Governance, Nominating and Social Responsibility Committee.
SR is not simply part of the Committee’s name; it is one of the central responsibilities of the Committee’s charter. Over the past year, both the Committee and the full Board have reviewed the SR Program in detail, including the processes for stakeholder engagement, reporting, consideration of stakeholder feedback and risk management.
How does Oxy’s Social Responsibility Program contribute to continuous improvement in the company’s performance?
Oxy’s operational excellence, strong safety culture and SR commitments have been key drivers of business success. The SR Program is implemented throughout Oxy’s diverse operations using the Health, Environment and Safety (HES) Management System, which provides consistent input on social and HES considerations for business decision-making. Oxy applies this system to identify stakeholders, assess social and HES risks and issues, and develop specific action plans to resolve potential concerns associated with its operations in a systematic and thoughtful manner.
SR is founded on respect and communication, building trust through consistent actions. Accordingly, the effectiveness of Oxy’s SR Program depends on four essential elements: (1) maintaining high ethical standards; (2) engaging frequently with stakeholders to understand their interests and concerns; (3) addressing concerns associated with Oxy’s operations; and (4) creating positive long-term benefits for the communities where Oxy operates.
Oxy’s experience has shown that long-term success depends on positive interactions with its many stakeholders – the multitude of groups and individuals who have an interest in Oxy’s operations, including stockholders, neighboring communities, host governments, employees, contractors, customers, business partners and non-governmental organizations (NGOs). This is why SR practices are fundamental to the company’s continuous improvement.
How does Oxy engage with stakeholders on issues that are important to them?
Oxy engages with stakeholders on several levels and welcomes their suggestions on how to improve. Oxy’s Social Responsibility Report presents an annual update of its policies, programs and performance. The company’s website, Oxy.com, features an SR section that provides more detail and is frequently updated to reflect Oxy’s SR initiatives around the world. Collectively, these sources provide stakeholders with information to evaluate Oxy’s SR performance.
Board members and senior management engage periodically with stockholders to obtain their comments on Oxy’s Corporate Governance, Human Rights and HES policies and practices. General managers and operations personnel from Oxy’s business units also meet regularly with community stakeholders to discuss company projects as well as social and HES performance.
You mentioned that the company meets regularly with community groups. How does Oxy interact with communities?
A key objective of Oxy’s SR Program is to contribute to the long-term sustainability of local communities near its operations, both in the United States and around the world. Oxy advances sustainable development programs that build the capacity of local workforces and improve living conditions, both directly and by providing essential support to other organizations. These programs provide education, vocational training and other resources to local residents and businesses to help them succeed. Oxy’s commitment also extends to environmental protection programs that engage communities in the conservation of local resources.
This report and Oxy’s website provide several examples of important community-based programs implemented by Oxy’s business units, often in partnership with government agencies or NGOs. This long-term engagement with community stakeholders builds trust and mutual respect, improves the community and the company, and supports Oxy’s business performance.
http://www.oxy.com/sr/governance/Pages/InterviewWithDirector.aspx