Mr Tony Hayward is not going to be exactly impoverished when he quits as Chief Executive of BP. And so, inevitably, an awful lot of pulpit thumping is going on decrying the £600,000 per year pension, the accrued performance pay, the share options, and all the other titbits that are coming his way once he reaches the ripe old age of 55. Most of it will be misplaced.
In the first instance, a lot of the angst is centred on the sheer amounts involved. Unless you also take the view that the captains of industry are paid obscenely too much in general (a view with which I have more than a little sympathy) there is no case for bemoaning the payout in Mr Hayward’s case. These are the sums he is entitled to contractually as a consequence of his 28 years with the company. It’s to embark along a very dangerous road to propose that because the popular mood is angry, contracts should be cheerfully ripped up and ignored. It will not only be fat-cats that are in jeopardy then. And it’s even more dangerous to suppose that the public mood is justification in itself, regardless of contractual mishap. The papers and individuals frothing at the mouth about Mr Hayward and evil BP are the same papers that support deep water drilling, and the same individuals that put the results into their cars without a second thought.
But what might legitimately lead to the conclusion that Mr Hayward has in some way so fatally broken his side of his contractual obligations to BP that they are entitled to put the contract aside? In this case the argument, and not a very considered one, is that the Gulf débâcle is in some way Mr Hayward’s personal fault. I’ll come back to that in a moment. Or else that his lapses of judgement in his dealings with the media have been so heinous that they in themselves justify tearing up his contract. Poppycock. We no longer have trial by ordeal even for the chief executives of oil companies or where the ordeal is that of dealing with a hostile and self-righteous media. So Mr Hayward is entitled to have his contractual rights respected, and if you don’t like the results then it’s the contract, and not Mr Hayward, that is remiss.
Let’s go back to that issue of personal fault. We get very confused, I think, between fault, responsibility, and accountability. Each of these terms it seems to me describes increasing distance between the individual and the acts or events that give rise to them. Let me illustrate, by reference to one of the things under my wing at work: health and safety.
Suppose that there is a fire in a set of premises that my company owns and manages, and as a consequence someone dies. This is hardly a set of circumstances that stretches the imagination, and it’s a possibility that causes me more than a little anxiety. To be at fault over something means that you have done, or failed to do, something that directly results in a bad thing happening. In this case perhaps a caretaker, who is responsible for ensuring that no combustible material is allowed to gather in communal parts of the building, has failed to do that and the cause of the fire is determined to be in the rubbish that he or she has allowed to accumulate. That person is clearly at fault. They should personally have done something, but they didn’t. However, the caretakers have a supervisor who is charged with training their staff, and ensuring that they have the wherewithal to do their jobs properly. If in this case they didn’t do that effectively, and the caretaker received no training, then they are responsible for the fire as well. Their failure did not directly cause the fire, but I think most people would agree that they contributed to its occurrence. A member of my team holds the brief for health and safety, including training. I would be holding them responsible too if it became clear that they never provided training or advice to the caretaking supervisor about their role in fire safety. It might be that I had done everything I was supposed to do. I had issued instructions to my H&S team; I had ensured that proper policies and procedures were in place; I had regularly reminded all concerned about their various responsibilities. Would I be at fault, or responsible for the death of the person in the fire? No. But I would be accountable. Fire safety is part of my watch. Regardless of fault and responsibility, the plain fact would be that something had gone terribly wrong, and that it is a something that I am relied upon by our residents to prevent. In such circumstances it might be right to remove me from my job, but not, I think, rip up the contractual obligations that my employer has towards me.
So it is entirely fair to say that the buck stops with Mr Hayward, and that when something goes as wrong as it has done for BP in the Gulf, he should ultimately be accountable. That does not make the Gulf disaster his fault. It does not even necessarily confer on him any responsibility whatever for the terrible consequences. It certainly doesn’t make his 28 years’ service to the company null and void. I don’t think Mr Hayward has much to complain about in losing his job. And I don’t think we’ve got much to complain about in his keeping his pension entitlements.
Unless of course you believe that it’s wrong to issue such generous contracts in the first place. In which case, say so. Mr Hayward is rightly accountable, but that doesn’t legitimate turning him into a scapegoat.