Ethical Performance
inside intelligence for responsible business


Premier Oil to ponder human rights agenda

September 1999

Premier Oil intends to improve its ethical performance by launching a set of guiding principles this winter and a social audit in 2000.

The UK-based oil exploration and production company, which has run into adverse publicity over its operations in military-led Burma (also known as Myanmar), will include a section on human rights in the 12-point principles.

Board members will study a draft version shortly and are expected to issue a final document in late November.

Richard Jones, newly appointed manager of global social responsibility at Premier, said the principles would include ‘a very specific Premier Oil human rights policy’ designed to cover its oil and natural gas activities in Albania, Cambodia, China, Indonesia, Burma and Pakistan as well as in Australia, India and the UK.

The principles, backed up with training for managers, will form the basis of Premier’s first ever social audit next year.

‘The idea is to set the stage to produce a social report in 2000,’ said Jones, who has moved from work on Premier’s social programmes in Burma to pilot the initiative.

‘The principles for corporate social responsibility will give us parameters against which we can measure ourselves in a social audit.’

Premier says it has been talking for some time to The Amnesty International Business Group and has listened to pressure groups such as the Burma Campaign UK.

It has also approached the UK’s Institute of Social and Ethical Accountability about benchmarking models and is considering signing up to the SA8000 ethical trading standard administered by the Council on Economic Priorities.

Although Premier is a relatively small oil company with 1998 net income of $227 million, its presence in Burma, where the military junta has been accused of human rights abuses, has been widely condemned.

Burmese democracy party leader Aung San Suu Kyi, who has not been allowed to take power despite her landslide election victory in 1990, has consistently called on Premier to pull out of the country.

The company’s recent AGM was disrupted by protesters led by the World Development Movement, a UK-based pressure group.

Jones acknowledged that outside pressure had had some impact on the company’s stance and that the AGM ‘was an opportunity to learn about the concerns of various stakeholders’.

However, he stressed that the new initiative did not mean the company would be moving out of Burma.

‘We operate in countries where we can do something positive and we prefer engagement, but it’s possible that our community efforts have not been all that well co-ordinated,’ he said.

‘But for a company of our size I think we are being very brave in throwing everything open. What we hope to achieve at the end of the day is to change the culture by setting out principles that are going to govern our business units’, he added.

A spokesperson for Pensions and Investment Research Consultants, the independent corporate responsibility advisers, which has been pushing Premier to improve its social accountability, said the company ‘is at the forefront of environmental and corporate responsibility concerns,’ and added: ‘Premier might feel it is going through fire just at present but it will be a better company for the experience’.

A rebel shareholder group at Premier has called on the company to sell its interests in Burma, Indonesia and Malaysia.


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