Indonesia is one of the world's most challenging places in which to conduct business.
BP Indonesia has been operating a local ethics governance board since 2000 when the scale of our business was increased considerably following the purchase of Arco. Significant effort has been made to ensure that staff understand BP’s Ethical Policies and the changes made in 2002. All aspects of our business have been examined to identify where facilitation payments might occur, then plans were put in place to eliminate them. There have been many examples where actual and potential payments were identified and then stopped.
For example:
- the ‘meet and greet’ service at Jakarta airport
- ''meeting fees' for government officials where these are not covered by government policies
- payments to speed up the process of granting forestry permits in connection with our activities in Papua where our major gas field, Tangguh, is located
- excessive gifts and entertainment, including traditional gifts at Lebaran. These are still given in accordance with local custom and practice but have been much reduced and now conform with the local gifts & entertainment policy
- contracts with some agents were not renewed after it was suspected that they used facilitation payments to provide their service
By the end of 2002 there were no known payments made directly by BP employees. Indeed, there have been several examples where employees have reported that third parties (contractors) have attempted to give them cash, either as a 'reward' for giving them business or as an incentive to direct business their way. This gives some reassurance that the policies are reaching deep into the organisation.
We hope that the firm stance on facilitation payments will have a positive effect on behaviour outside the workplace and hence a positive effect in the wider community and business environment. BP is a leading member of Indonesia Business Links (IBL), an independently sponsored cross-business forum. IBL aims to improve the transparency of corporate governance and behaviourial practices of its members. In 2002, working with other international oil and gas companies, BP Indonesia helped draft a 'code of conduct' for the oil and gas sector which included guidelines on ethics.