IP: ChevronTexaco CEO calls for corporate cooperation to improve industry reputation

Feb. 18, 2003
David O'Reilly, chairman and CEO of ChevronTexaco Corp., challenged oil and natural gas companies to work together to improve the industry's reputation at the Institute of Petroleum's annual meeting.

By OGJ editors

HOUSTON, Feb. 18 -- David O'Reilly, chairman and CEO of ChevronTexaco Corp., challenged oil and natural gas companies to work together to improve the industry's reputation Tuesday at the Institute of Petroleum's annual meeting in London.

Energy is "at the nexus of social, economic, and political change" in many places around the world, said O'Reilly. From Venezuela to Iraq to Korea, he said, "Current events have put our industry in the spotlight. They raise familiar questions about what we do, how we do it, and the costs and benefits of our products."

O'Reilly told industry representatives, "We must have a clear understanding of the consequences of a poor reputation." Those consequences "go far beyond public relations" to "the bottom line" of business operations and extend "far into the future," he said.

The most obvious consequence of poor performance by the industry, he said, is government regulation. "When we fail to raise our standards, we invite governments to do it for us, through regulations that can be costly and onerous," O'Reilly said. "If we prefer market-based solutions to government mandates, the burden is on us to confront the consequences of 'business as usual.'"

Another consequence, he said, is access to resources. "The industry's access to resources is the product of many things, but partly it is a matter of reputation," he said. "If we want access to resources to be decided on the merits, we have to make our reputation a help, not a hindrance."

However, O'Reilly said, "Perhaps the most damaging consequence has to do with the most important resource—talent. People are the lifeblood of our industry. Yet I fear that recruiting and retaining talent is made more difficult by every spill and every cyclical downturn."

He warned, "If we fail to improve our image among potential recruits, we won't be able to attract the best people."

O'Reilly rejected claims by some that improving the industry's reputation with the public is a lost cause. "This is far too important to be a lost cause," he said.

"Many of us here are working to right the balance between credit and criticism, but most of our efforts are competitive rather than collaborative," said O'Reilly. "The industry-wide efforts we do see are neither sustained nor sufficiently resourced. As a result, these efforts have not been good enough or widespread enough to make a lasting difference."

He said, "While we need to tell our story better, we also need a better story to tell. So we have to improve performance, doing more to protect the environment and communities where we operate, while improving our operations."