The Baker Panel Report - ABSA

Process safety leadershipThe Panel believes that BP has not provided effective leadership on or established appropriate operational expectations regarding processsafety performance at its U.S. refineries. As discussed below, the Panel believes that the lack of effective leadership is systemic, touching alllevels of BP’s corporate management having responsibility for BP’s U.S. refineries.Establishing appropriate process safety goals and performance expectations. The information available to the Panel indicates that BPemphasized personal safety but not process safety and did not set an appropriate process safety “tone at the top” or establish appropriateoperational goals and expectations regarding process safety performance for BP’s U.S. refineries. The Panel believes that establishing the right“tone at the top” of an organization is particularly within the domain of executive management.As discussed later in this section, BP uses a system of cascading performance contracts and variable pay programs to drive desiredperformance within the organization on a variety of matters, including operations, financial performance, environmental performance, andpersonal safety. Given the importance of performance contracts and variable pay programs to achieving BP’s goals, the metrics and milestonesincluded in them are critical. Prior to 2006, however, performance contracts and variable pay programs in BP’s U.S. refineries did not containmetrics that would act as a significant and positive incentive for ensuring process safety performance.While BP has the aspirational goal that there be “no accidents, no harm to people,” it appears that refinery managers have not receivedeffective operational guidance from corporate-level refining management about how to achieve this goal. It also appears that executivemanagement has neither technical refining experience nor substantial input from a designated full-time process safety staff position toprovide process safety input into decisions that affect the U.S. refining operations. The Panel would not necessarily expect the chief executiveofficer or head of all of refining and marketing of a global integrated energy company to be a process safety expert. BP has long had a numberof corporate-level managers—in refining, Group Technology, Refining Technology, the HSSE organization, and elsewhere—who either had, orshould have had, a much deeper understanding of refining process safety than BP executive management. As discussed elsewhere in thissection, that so many different staff members in the BP organization provide some support for process safety performance may dilute theeffectiveness of input from staff to line management. The information available to the Panel also indicates, as would be expected, thatcorporate-level refining line management below the executive level has greater process safety knowledge and operating and technical refiningexpertise than executive management. For whatever reasons, BP corporate managers with line responsibility for the U.S. refineries have not, asa group, demonstrated effective leadership in and commitment to process safety. BP appears to have had a corporate blind spot relating toprocess safety. BP executive management apparently believed that they were appropriately addressing process safety issues and risks, and ittook the tragedy of the Texas City accident to wake BP up to the fact that it was not adequately measuring, tracking, and managing processsafety performance.During the course of its review, however, the Panel observed a shift in BP’s understanding of process safety. As discussed in Appendix F, BP hasundertaken a number of measures designed to improve process safety performance. In addition, BP executive management and corporate-levelmanagement have more visibly demonstrated their commitment to process safety in recent months.Demonstrating commitment to process safety through communications and visibility. In order to ensure that corporate-level managersand the U.S. refining workforce develop a shared value on the importance of process safety, BP’s corporate management must clearly,frequently, and consistently communicate that value. During its review, the Panel found little to indicate that before March 2005, BP corporatemanagement had effectively demonstrated its commitment to process safety either through its communications or through a regular presenceat the U.S. refineries.Corporate Safety Culture C 66