After the Spill
Oil and gas leaders confront the strategic challenges ahead
With the oil-spill in the Gulf of Mexico under control, attention has turned to the longer-term effects of this event for the oil and gas industry. The health, safety, and environmental (HS&E) practices of oil and gas companies’ have come under intense scrutiny of regulators, investors, and the public. They are expecting more effective management of the risks involved in an inherently risky industry. For many oil and gas companies, this calls for the rapid adoption of a number of changes to previous standard industry practices and compliance with a plethora of anticipated new regulations. In addition, due to the magnitude of the financial costs involved, corporate boards and senior management are being challenged to better identify, understand, assess, price, and manage the risks associated with their companies’ operations.
This article describes how boards and management can adopt a disciplined and structured approach and embed HS&E risk identification and management into their organizations’ strategy, operations, and governance structures.