BP AND SHELL

University Degree Business and Administrative studies

BP and SHELL recruitment and corporate issues

BP is one of the world's largest energy companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items

About BP

BP was founded as the Anglo Persian Oil Company by William Knox D'Arcy in 1909 BP produces 3.9 million barrels of oil equivalent per day of oil and gas for customers across the world The 1,768-kilometre Baku-Tbilisi-Ceyhan (BTC) pipeline, from Baku in Azerbaijan through Georgia to Ceyhan on the Turkish Mediterranean coast, represents one of the great engineering projects of our era With partners Petrochina and Sinopec we plan to develop approximately 1000 outlets in China by the end of 2007

Corporate Governance Issues

How our governance practices differ from those followed by domestic US companies listed on the NYSE

BP American depositary shares (ADSs) are listed on the New York Stock Exchange. Each BP ADS represents six BP ordinary shares.
Although non-US companies like BP are exempt from most of the corporate governance rules of the New York Stock Exchange (NYSE), pursuant to Rule 303A.11 of the NYSE Listing Manual, we are required to disclose any significant ways in which our corporate governance practices differ from those followed by domestic US companies listed on the NYSE.

Independence
BP has adopted a robust set of board governance principles, which reflect the UK's prevailing principles-based approach to corporate governance. As such, the way in which BP makes determinations of directors' independence differs from the NYSE rules. NYSE Rule 303A.02 sets out five bright line tests for director independence. In addition to these five tests, the NYSE also requires that the board of directors "affirmatively determines that the director has no material relationship with the company (either directly or as a partner, shareholder or officer of an organization that has a relationship with the company)".

BP's board governance principles require that all non-executive directors be "independent in character and judgement and free from any business or other relationship which could materially interfere with the exercise of their independent judgement".

The BP board has determined that, in its judgement, all of the non-executive directors are independent. In doing so, however, the board did not explicitly take into consideration the NYSE's five bright line tests.
Committees
BP has a number of board committees which are broadly comparable in purpose and composition to those required by NYSE rules of domestic US companies. For instance, BP has a chairman's (rather than executive) committee, nomination (rather than nominating/corporate governance) committee, remuneration (rather than compensation) committee and an audit committee. These committees are composed solely of non-executive directors whom the board has determined to be independent, in the manner described above.
The BP board governance principles prescribe the tasks, process and composition of each of the committees (which are summarised in the annual report and on the website). BP has not, therefore, adopted separate charters for each committee.
One of the NYSE's additional requirements for the audit committee states that at least one member of the audit committee is to have "accounting or related financial management expertise". For 2007, the board determined that Douglas Flint possessed the financial and audit committee experience as defined for the purposes of disclosure in Item 16A of Form 20-F, and has nominated him as audit committee financial expert.
Shareholder approval of equity compensation plans
The NYSE rules require that shareholders must be given the opportunity to vote on all equity-compensation plans and material revisions to those plans. BP complies with UK requirements which are similar to the NYSE rules. The board, however, does not explicitly take into consideration the NYSE's detailed definition of what are considered "material revisions".

Code of ethics
The NYSE rules require that domestic US companies adopt and disclose a code of business conduct and ethics for directors, officers and employees. BP has adopted a code of conduct, which applies to all employees, and has board governance policies which address the conduct of directors. In addition BP has adopted a code of ethics for senior financial officers as required by the SEC. BP considers that these codes and policies address the matters specified in the NYSE rules.
Other exchanges
In the US, BP is also listed on the Chicago Stock Exchange (CHX). The listing standards of this exchange are very similar to the NYSE's, and the discussion on corporate governance practices above also reflects significant ways in which BP's corporate governance practices differ from those required for US companies under the listing standards of the CHX. As a foreign private issuer listed on this exchange, BP is exempt from most of the exchange’s corporate governance standards requirements.

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Business Ethics

This is a preview of the whole essay

Business Ethics

As one of the world’s leading companies, we have a responsibility to set high standards: to be, and be seen to be, a business which is committed to integrity. In a complex global business environment like ours, that’s not always easy. Our code of conduct is designed to help us achieve this.

Our code of conduct is the cornerstone of our commitment to integrity. As Tony Hayward, the group chief executive, affirms: “Our reputation, and therefore our future as a business, depends on each of us, everywhere, every day, taking personal responsibility for the conduct of BP’s business”. The BP code of conduct is an essential tool to help our people meet this aspiration. The code summarizes our standards for the way we behave. All our employees must follow the code of conduct. It clearly defines what we expect of our business and our people, regardless of location and background. Ultimately it is about helping BP people to do the right thing.

The code includes many examples of how our group values should be applied in specific situations. The level of detail and practical approach signal our determination to embed our values and a culture of integrity more firmly in our group.

The code covers five key areas of our business operations:

health, safety, security and the environment – fundamental rules and guidance to help us protect the natural environment, the safety of the communities in which we operate, and the health, safety and security of our people
employees – covering fair treatment and equal opportunity, providing guidance for dealing with cases of harassment or abuse and for protecting privacy and employee confidentiality
business partners – providing detailed guidance on giving and receiving gifts and entertainment, conflicts of interest, competition, trade restrictions, money laundering and working with suppliers
governments and communities – covering such areas as bribery, dealing with governments, community engagement, external communications and political activity
company assets and financial integrity – containing guidance about accurate and complete records and reporting, protecting company property, intellectual property, insider trading and digital systems

Corporate social responsibility issues

The term CSR covers a vast range of policies and interventions and adjustments in the way companies conduct themselves. Everything from the way you manage your staff, communicate with your staff, make charitable contributions, sponsor artistic and cultural events all the way through to commitments to recycling and the use of renewable resources

bp and challenge of improving performance and operational effectiveness

Recruiting and Retaining a skilled workforce

Given the increasing competition for talent and skills, BP is taking steps to demonstrate the attractions of a BP career to potential employees at all levels

Able university graduates are a prime source of recruitment for future leaders, managers and professionals and we’ve improved our outreach to this group in several ways. As well as developing a new marketing campaign, ‘Look beyond the limits’, and a new selection process, we forged stronger relationships with a series of selected universities worldwide, which have a leading record in producing high-quality graduates in key disciplines such as engineering and geology.

We strengthened these relationships by assigning individual BP executives to be sponsors for our activities, often graduates of the universities concerned, and drawing up campus plans for each institution. These increase the opportunities for students to meet BP employees at occasions such as seminars, lectures, workshops, field visits or social events.

We are also investing $18 million over three years on sponsoring selected US and UK colleges and universities.

SkillsWell – utilizing the expertise of former BP employees

BP has developed a programme called SkillsWell to retain access to the expertise of former BP employees by hiring them on short-term contracts after retirement.

Applying online

In keeping with the drive to simplify BP’s activities, we are introducing a new, standardized, internet-based system for all job applications, which will make applying to BP simpler for candidates, as well as enabling BP to assess candidates more easily and to process applications more quickly. This went live in most business units in 2007 and we plan to roll it out to most of BP in 2008.

Recruiting local talent

In recruiting potential future leaders and other staff, BP particularly focuses on building local capability in new and emerging markets and we shape our reviews and resourcing plans accordingly. For example, in Azerbaijan, we achieved our 2007 target for 75% of professional positions to be filled by national specialists

Shell

Shell is a global group of energy and petrochemical companies. With 104,000 employees in more than 110 countries, we play a key role in helping to meet the world’s growing demand for energy in economically, environmentally and socially responsible ways.

Corporate Governance

Business Ethics

Code of Ethics

Code of Ethics for Executive Directors and Senior Financial Officers of the Shell group. This Code of Ethics ("this Code") should be read in conjunction with the Statement of ("SGBP") of Royal Dutch Shell plc which governs how each of the Shell companies which make up the group conducts its affairs.

The SGBP has been adopted by all Shell companies and, amongst other things, provides that all persons must avoid conflicts of interest between their private financial activities and their part in the conduct of company business. This Code is specifically intended to meet the requirements of and the by providing for a number of implementing requirements in the area of disclosure controls and the avoidance of conflicts of interest by the category of job holders and persons referred to below.

This Code is applicable to the following job holders and persons:

the Executive Directors of Royal Dutch Shell;
the Chief Financial Officer;
the Executive Vice President – Controller;
the Executive Vice President – Treasury and Corporate Finance;
the Chief Internal Auditor;
the Executive Vice President - Taxation;
the Executive Vice President - Investor Relations;
Executive Vice Presidents - Finance of Exploration and Production, Downstream and Gas and Power;
any person or job holder designated by the Chief Financial Officer (a register of such designated persons will be maintained by the Company Secretary).

All of the above are hereinafter referred to as "COE Addressees".

Key Requirements

Each COE Addressee shall:

a. act in accordance with the highest standards of honesty, integrity and fairness and expect the same in their relationships with others while maintaining a work and business climate fostering such standards; and
b. adhere to the SGBP, any applicable code of conduct on dealing in securities and any provisions for the avoidance of conflicts of interest stipulated in applicable terms and conditions of employment; and
c. excuse himself from making any decision about an issue at hand in which a conflict of interests arises or could arise and in such event, disclose in writing the relevant facts and explain the circumstances that create or could create the conflicts of interest to: (a) the chairman of the Audit Committee in the case of: (i) the Executive Directors of Royal Dutch Shell, (ii) the Chief Financial Officer, (iii) the Chief Internal Auditor and (iv) the Executive Vice President Controller, and (b) to the Executive Vice President Controller, in the case of any other COE Addressee; and
d. avoid having any financial interest in works of or contracts awarded by a Shell company or a company associated with a Shell company, or in supplies effected or services rendered to or by such a company and where this is unavoidable or immediate family members have such a financial interest, such interest shall be disclosed in writing in the same manner as set out in c. above; and
e. not seek or accept from third parties to his own advantage any favour in whatsoever form or howsoever described in connection with the business of any Shell company or his duties (except for the acceptance of such things as gifts of nominal value and working lunches, dinners and entertainment of reasonable value, frequency and duration, appropriate under the circumstances, and subject always to the standards of a. above); and
f. not hold positions or jobs or engage in outside businesses or other interests that adversely impact the performance of duties owed to any Shell company or the interests of the same; and
g. avoid any relationship with a contractor or supplier that could compromise the ability to transact business on a professional, impartial and competitive basis or influence decisions to be made by any Shell company; and
h. consistent with the scope of his job responsibilities, ensure full, fair, accurate, timely, and understandable disclosure in regulatory filings and in other public communications made by Royal Dutch Shell.

Reporting

Each COE Addressee shall report any breach thereof in writing to: (a) the chairman of the Audit Committee in the case of: (i) the Executive Directors of Royal Dutch Shell, (ii) the Chief Financial Officer, (iii) the Chief Internal Auditor and (iv) the Executive Vice President-Controller, and (b) the Executive Vice President Controller in the case of any other COE Addressee.

No person reporting in good faith a suspected breach of conflicts of interest should be concerned about retaliation by Shell companies. Any job holder or person involved in retaliation will be subject to the sanctions referred to below.

Accountability

Each COE Addressee is held accountable for the full compliance with this Code with respect to any issues within his control. Sanctions for a breach of this Code shall be determined by: (i) the Board of Directors of Royal Dutch Shell where it concerns the Executive Directors of Royal Dutch Shell or the Chief Financial Officer; and (ii) the Audit Committee where it concerns any other COE Addressee. Sanctions may include serious disciplinary action, removal from office and dismissal as well as other remedies, all to the extent permitted by law and as appropriate under the circumstances.

Miscellaneous and Waivers

No waiver of any provision of this Code shall be valid unless provided in writing by the chairman of the Audit Committee and with the prior approval of the Audit Committee.

In this code words importing the masculine shall include the feminine and words importing the singular shall include the plural or vice versa.

The provisions of this Code can be amended and supplemented from time to time by resolution of the Board of Directors of Royal Dutch Shell.

Improving performance and operational effectiviness

We face a constant challenge from the Shell group - to improve operating performance while reducing costs and raising safety standards. The lessons learned in responding to this challenge, together with practical expertise from designing and building many airports, and operating over 700 fuelling facilities worldwide that underpins the work of all our Performance Consultants

Recruiting and retaining a skilled workforce

Diversity and Inclusiveness at Shell

With a core strategic team in Central HR as well as representatives in Shell businesses worldwide, Diversity and Inclusiveness is an integral part of the Shell Group. It has a vital part to play in underpinning its continuing success by ensuring Shell attracts, recruits and retains the best people - regardless of their gender, nationality or background.

The reasons are all based on our quest for business effectiveness. As a forward-thinking organisation, we're always looking for people of the highest calibre. By enabling us to select from the biggest possible pool of talent, Diversity and Inclusiveness can actively help us to find these candidates. This is why we also need to employ talented individuals from the country in which the business is based.

For example, Shell is expanding its operations in Asia. It's a massive advantage to have people in place who know the local business customs and markets. And, to stay in tune with our customers, it's equally important that our workforce fully reflects their diversity.

Our work can be split into five core areas. Effective recruitment and retention strategies will enable us to select from the widest possible group of candidates. Proactive development and mentoring will give all our employees the opportunity to fulfil their true potential - recent examples being a mentoring circles and employee networks who can share experiences and offer mutual support. Ensuring a supportive work environment means creating an atmosphere where difference is not just tolerated, but actively valued. This manifests itself in everything from childcare and flexible working schemes to anti-bullying strategies.

Metrics are also important. Every two years, Shell conducts the Shell People Survey that enables us to gauge the real views of all our employees as to the level of inclusiveness they experience in the organisation. We analyse trends and identify the needs of specific groups. And last but not least, we use innovative communication and education techniques to ensure the diversity and inclusiveness message is not only conveyed to employees but embraced by them through a range of awareness and skill-building programmes.

In detail:

Diversity and Inclusiveness create a competitive edge and are vital for winning in today's global business environment. Our key priorities are:

To ensure Shell attracts, recruits and retains the best people - regardless of their gender, nationality, background, age, physical ability or sexual orientation
To ensure programmes are in place that ensure every Shell employee has the opportunity to fulfil their potential
To work with senior leaders to instil a culture where difference is valued and regarded as key to delivering business advantage
To make certain that diversity messages are clearly and innovatively communicated to achieve buy in from all employees

To succeed, you'll need to be:

Commercially aware, to understand how Diversity and Inclusiveness can support the business to achieve key goals
Able to see the bigger picture and think strategically
Equipped with a broad understanding of generalist HR policies
Credible, to build strong relationships with senior leaders and influence their opinions