How We Operate

BP Sustainability
Reporting 2009
How we operate
15 April 2010 bp.com/pdfdownloads
This download of selected pages from our full online Sustainability

Reporting 2009 may not provide sufficient information to allow as
full an understanding as would reading the entire online
Sustainability Reporting 2009 contained within the website. BP
Sustainability Review 2009 and the online BP Sustainability
Reporting 2009 contain certain forward-looking statements
concerning the businesses, operations and strategy of BP. For
details see: Cautionary statement at
www.bp.com/cautionarystatement
BP Sustainability Review 2009 and the online BP Sustainability
Report 2009 have been prepared by the management of BP p.l.c..
Ernst & Young have carried out a limited assurance review of the
Review and Report. For details see: Ernst & Young assurance
statement at www.bp.com/assurancestatement
No part of the online Sustainability Reporting 2009 constitutes, or
shall be taken to constitute, an invitation or inducement to invest
in BP p.l.c. or any other entity and must not be relied upon in any
way in connection with any investment decisions.
Meeting the energy demands

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Governance
BP operates globally according to a

system of internal control that extends
from corporate governance policies at
board level to detailed processes that
are applied in our operations
The board
The board is responsible for the direction and oversight of BP p.l.c. on

behalf of shareholders; it is accountable to them, as owners, for all aspects
of BP’s business. The board sets the tone from the top, and has
established a set of board governance principles, which delegate
management authority to the group chief executive (GCE) within defined
limits. These include a requirement that the GCE will not engage in any
activity without regard to health, safety and environmental consequence. On
1 January 2010, the board was composed of the chairman, eight non-
executive directors and five executive directors.
The board maintains five permanent committees that are composed entirely
of non-executives. They include the audit committee, the remuneration
committee and the safety, ethics and environment assurance committee
(SEEAC). Monitoring the GCE’s identification and management of the
group’s risks – both financial and non-financial – is conducted through the
board and its committees.
SEEAC monitors non-financial risk, which includes regular reviews of

information and reports from the safety and operations function. It also acts
for the board in working with the Independent Expert to review the progress
made in implementing the recommendations of the BP US Refineries
Independent Safety Review Panel.
Managing the business
BP utilizes a comprehensive set of management systems, organizational

structures, processes, standards and behaviours to conduct our business
and deliver returns for shareholders. This system of internal control is
maintained by the GCE.
Control environment
BP’s code of conduct and values demonstrate our commitment to integrity,

ethical values and legal compliance. Additionally, our commitment to
competence is through having the right people with the right skills doing the
right thing supported by our leadership framework.
The GCE has established an operating style that sets direction for the
company and places continual emphasis on our priorities of safety, people
and performance. Delegation of authority, designed to make sure
employees understand what is expected of them, is integral to this control
environment.
Risk management
Group risks – the significant risks that could affect the achievement of our
objectives – have responses designed to deal with them in the most
appropriate way. These include our operating management system for
delivery of safe, responsible and reliable operating activity, and group
standards, which set out processes for other major areas such as
investment decisions or fraud and misconduct reporting.
The GCE’s senior team – known as the executive team – is supported by

sub-committees to be responsible for and monitor specific group risks.
These include the group operations risk committee, the group financial risk
committee and the group people committee. The GCE also conducts
regular performance reviews with the business segments and key functions
to monitor performance and the management of risk and to intervene if
necessary.
People management
People management is based on performance objectives through which

individuals are accountable for delivering specific elements of the group
plan within agreed boundaries.
Clear lines of communication exist for the provision of relevant information

to help ensure all people are clear on what is expected of them and are up
to date with the latest context in which to do their job. Employees can raise
concerns with line managers, human resources, legal or compliance teams
or through OpenTalk, an independent confidential helpline.
Attestation
The information on this page forms part of the information reviewed and
reported on by Ernst & Young as part of BP's 2009 sustainability reporting.
Ernst & Young's assurance statement

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Risk management
BP’s system of risk management is

designed to identify risks to the group
and its operations and act to respond
to them
The responses to risks are provided through the establishment of standards
and other controls. Our ability to identify, assess and respond effectively to
the material risks enables us to capture opportunities, prevent threats
materalizing and drive efficient operations and compliance with laws and
regulations.
The risks to the group are categorized against the following areas: strategic;
compliance and control; and operational.
Strategic risks
Access and renewal

Successful execution of our group plan depends critically on implementing
activities to renew and reposition our portfolio. The challenges to renewal of
our upstream portfolio are growing due to increasing competition for access
to opportunities globally. Lack of material positions in new markets and/or
inability to complete disposals could result in an inability to grow or even
maintain our production.
Prices and markets

Oil, gas and product prices are subject to international supply and demand.
Political developments and the outcome of meetings of OPEC can
particularly affect world supply and oil prices. Previous oil price increases
have resulted in increased fiscal take, cost inflation and more onerous
terms for access to resources. As a result, increased oil prices may not
improve margin performance. In addition to the adverse effect on revenues,
margins and profitability from any fall in oil and natural gas prices, a
prolonged period of low prices or other indicators would lead to further
reviews for impairment of the group’s oil and natural gas properties. Such
reviews would reflect management’s view of long-term oil and natural gas
prices and could result in a charge for impairment that could have a
significant effect on the group’s results of operations in the period in which
it occurs. Rapid material and/or sustained change in oil, gas and product
prices can impact the validity of the assumptions on which strategic
decisions are based and, as a result, the ensuing actions derived from those
decisions may no longer be appropriate. A prolonged period of low oil
prices may impact our ability to maintain our long-term investment
programme with a consequent effect on our growth rate and may impact
shareholder returns, including dividends and share buybacks, or share
price. Periods of global recession could impact the demand for our
products, the prices at which they can be sold and affect the viability of the
markets in which we operate. Refining profitability can be volatile, with both
periodic oversupply and supply tightness in various regional markets.
Sectors of the chemicals industry are also subject to fluctuations in supply
and demand within the petrochemicals market, with a consequent effect on
prices and profitability.
Climate change and carbon pricing

Compliance with changes in laws, regulations and obligations relating to
climate change could result in substantial capital expenditure, taxes,
reduced profitability from changes in operating costs, and revenue
generation and strategic growth opportunities being impacted. Our
commitment to the transition to a lower-carbon economy may create
expectations for our activities, and the level of participation in alternative
energies carries reputational, economic and technology risks.
Socio-political
We have operations in countries where political, economic and social
transition is taking place. Some countries have experienced political
instability, changes to the regulatory environment, expropriation or
nationalization of property, civil strife, strikes, acts of war and insurrections.
Any of these conditions occurring could disrupt or terminate our operations,
causing our development activities to be curtailed or terminated in these
areas or our production to decline and could cause us to incur additional
costs. In particular, our investments in Russia could be adversely affected
by heightened political and economic environment risks. We set ourselves
high standards of corporate citizenship and aspire to contribute to a better
quality of life through the products and services we provide. If it is
perceived that we are not respecting or advancing the economic and social
progress of the communities in which we operate, our reputation and
shareholder value could be damaged.
Competition
The oil, gas and petrochemicals industries are highly competitive. There is
strong competition, both within the oil and gas industry and with other
industries, in supplying the fuel needs of commerce, industry and the home.
Competition puts pressure on product prices, affects oil products marketing
and requires continuous management focus on reducing unit costs and
improving efficiency. The implementation of group strategy requires
continued technological advances and innovation including advances in
exploration, production, refining, petrochemicals manufacturing technology
and advances in technology related to energy usage. Our performance
could be impeded if competitors developed or acquired intellectual property
rights to technology that we required or if our innovation lagged the
industry.
Investment efficiency
Our organic growth is dependent on creating a portfolio of quality options
and investing in the best options. Ineffective investment selection could lead
to loss of value and higher capital expenditure.
Reserves replacement
Successful execution of our group strategy depends critically on sustaining
long-term reserves replacement. If upstream resources are not progressed
in a timely and efficient manner, we will be unable to sustain long-term
replacement of reserves.
Liquidity, financial capacity and financial exposure

The group has established a financial framework to ensure that it is able to
maintain an appropriate level of liquidity and financial capacity and to
constrain the level of assessed capital at risk for the purposes of positions
taken in financial instruments. Failure to operate within our financial
framework could lead to the group becoming financially distressed leading
to a loss of shareholder value. Commercial credit risk is measured and
controlled to determine the group’s total credit risk. Inability to determine
adequately our credit exposure could lead to financial loss. A credit crisis
affecting banks and other sectors of the economy could impact the ability of
counterparties to meet their financial obligations to the group. It could also
affect our ability to raise capital to fund growth. Crude oil prices are
generally set in US dollars, while sales of refined products may be in a
variety of currencies. Fluctuations in exchange rates can therefore give rise
to foreign exchange exposures, with a consequent impact on underlying
costs and revenues.
Compliance and control risks
Regulatory
The oil industry is subject to regulation and intervention by governments
throughout the world in such matters as the award of exploration and
production interests, the imposition of specific drilling obligations,
environmental and health and safety protection controls, controls over the
development and decommissioning of a field (including restrictions on
production) and, possibly, nationalization, expropriation, cancellation or non-
renewal of contract rights. We buy, sell and trade oil and gas products in
certain regulated commodity markets. Failure to respond to changes in
trading regulations could result in regulatory action and damage to our
reputation. The oil industry is also subject to the payment of royalties and
taxation, which tend to be high compared with those payable in respect of
other commercial activities, and operates in certain tax jurisdictions that
have a degree of uncertainty relating to the interpretation of, and changes
to, tax law. As a result of new laws and regulations or other factors, we
could be required to curtail or cease certain operations, or we could incur
additional costs.
Ethical misconduct and non-compliance

Our code of conduct, which applies to all employees, defines our
commitment to integrity, compliance with all applicable legal requirements,
high ethical standards and the behaviours and actions we expect of our
businesses and people wherever we operate. Incidents of ethical
misconduct or non-compliance with applicable laws and regulations could
be damaging to our reputation and shareholder value. Multiple events of
non-compliance could call into question the integrity of our operations.
Liabilities and provisions

Changes in the external environment, such as new laws and regulations,
market volatility or other factors, could affect the adequacy of our provisions
for pensions, tax, environmental and legal liabilities.
Reporting
External reporting of financial and non-financial data is reliant on the
integrity of systems and people. Failure to report data accurately and in
compliance with external standards could result in regulatory action, legal
liability and damage to our reputation.
Operational risks
Process safety
Inherent in our operations are hazards that require continuous oversight
and control. There are risks of technical integrity failure and loss of
containment of hydrocarbons and other hazardous material at operating
sites or pipelines. Failure to manage these risks could result in injury or loss
of life, environmental damage, or loss of production and could result in
regulatory action, legal liability and damage to our reputation.
Personal safety
Inability to provide safe environments for our workforce and the public could
lead to injuries or loss of life and could result in regulatory action, legal
liability and damage to our reputation.
Environmental
If we do not apply our resources to overcome the perceived trade-off
between global access to energy and the protection or improvement of the
natural environment, we could fail to live up to our aspirations of no or
minimal damage to the environment and contributing to human progress.
Failure to comply with environmental laws, regulations and permits could
lead to damage to the environment and could result in regulatory action,
legal liability and damage to our reputation.
Security
Security threats require continuous oversight and control. Acts of terrorism
against our plants and offices, pipelines, transportation or computer systems
could severely disrupt business and operations and could cause harm to
people.
Product quality
Supplying customers with on-specification products is critical to maintaining
our licence to operate and our reputation in the marketplace. Failure to
meet product quality standards throughout the value chain could lead to
harm to people and the environment and loss of customers.
Drilling and production

Exploration and production require high levels of investment and are
subject to natural hazards and other uncertainties, including those relating
to the physical characteristics of an oil or natural gas field. The cost of
drilling, completing or operating wells is often uncertain. We may be
required to curtail, delay or cancel drilling operations because of a variety of
factors, including unexpected drilling conditions, pressure or irregularities in
geological formations, equipment failures or accidents, adverse weather
conditions and compliance with governmental requirements.
Transportation
All modes of transportation of hydrocarbons involve inherent risks. A loss of
containment of hydrocarbons and other hazardous material could occur
during transportation by road, rail, sea or pipeline. This is a significant risk
due to the potential impact of a release on the environment and people and
given the high volumes involved.
Major project delivery

Successful execution of our group plan depends critically on implementing
the activities to deliver the major projects over the plan period. Poor
delivery of any major project that underpins production growth and/or a
major programme designed to enhance shareholder value could adversely
affect our financial performance.
Digital infrastructure
The reliability and security of our digital infrastructure are critical to
maintaining our business applications availability. A breach of our digital
security could cause serious damage to business operations and, in some
circumstances, could result in injury to people, damage to assets, harm to
the environment and breaches of regulations.
Business continuity and disaster recovery

Contingency plans are required to continue or recover operations following
a disruption or incident. Inability to restore or replace critical capacity to an
agreed level within an agreed timeframe would prolong the impact of any
disruption and could severely affect business and operations.
Crisis management
Crisis management plans and capability are essential to deal with

emergencies at every level of our operations. If we do not respond or are
perceived not to respond in an appropriate manner to either an external or
internal crisis, our business and operations could be severely disrupted.
People and capability

Successful recruitment of new staff, employee training, development and
long-term renewal of skills, in particular technical capabilities such as
petroleum engineers and scientists, are key to implementing our plans.
Inability to develop the human capacity and capability across the
organization could jeopardize performance delivery.
Treasury and trading activities

In the normal course of business, we are subject to operational risk around
our treasury and trading activities. Control of these activities is highly
dependent on our ability to process, manage and monitor a large number of
complex transactions across many markets and currencies. Shortcomings
or failures in our systems, risk management methodology, internal control
processes or people could lead to disruption of our business, financial loss,
regulatory intervention or damage to our reputation.
Attestation
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Operating management system
BP’s operating management system is

the cornerstone of our approach to
achieving safe, reliable and responsible
operations at every BP site
BP’s chief executive Tony Hayward describes the operating management
system (OMS) as “the foundation for a responsible and high-performing BP.
It has two purposes: to further reduce HSSE risks in our operating activities
and to continuously improve the quality of those operating activities.”
Through principles and processes for application across the BP group, the
system provides for an integrated and consistent way of working. These
principles and processes are designed to simplify the organization, improve
productivity, enable consistent execution and focus BP on performance.
When fully implemented, OMS helps to deliver safe, responsible and
reliable BP operating activity and continuously improve performance.
OMS elements of operating
The system’s elements of operating describe eight dimensions of how

people, processes, plant and performance operate within BP. Our group
essentials and group defined practices describe requirements for risk
mitigation, legal and regulatory compliance, conformance with BP
requirements, and rigorous application of basic operating knowledge.
Together they help BP entities deliver safe, responsible and reliable
operating activities. They also create a platform for sustainable
improvement, allowing BP to capture additional value through efficiency.
Ultimately, this delivers sustainable excellence in operating.
OMS implementation
Emphasis on improvement
Our performance improvement cycle is at the heart of OMS, driving and

sustaining change and improvement in local business processes. It
incorporates the concept of continuous improvement (CI), which provides
the tools and frame of mind needed to engage the entire organization in
tackling challenges and ensuring that problems are eliminated and
operations run at maximum efficiency. Through CI, safety and reliability can
be delivered by empowering operations managers and supervisors, who are
closest to operational problems, to develop the necessary solutions. As
experience of working under OMS grows, the CI approach is bringing rigour
to local problem solving and generating learning by applying that experience
across our operations.
Delivering OMS locally
Each BP operating unit will have a local OMS that describes how it will
deliver its operating activities. Developed, implemented and sustained
locally, the local OMS translates business needs, relevant legal and
regulatory and BP requirements into practical plans to reduce risk an
deliver strong, sustainable performance.d
Attestation
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Human rights
BP is committed to respecting human

rights in line with our support for the
Universal Declaration of Human Rights
Our approach reflects human rights principles, as relevant, in the processes
that govern our business activity. BP’s code of conduct, for example, states
our commitment to fair employment and equal employment opportunity. It
also expresses our commitment to engage in open and transparent
dialogue with communities. Additionally, we make a very explicit statement
against the use of child labour and forced or compulsory labour.
Supplier and human rights
Human rights issues are considered when we assess potential suppliers, for
example by asking companies about their minimum hiring age in order to
exclude any suspected of using child labour.
In our refining and marketing business, for example, we are building on the
methods used by BP in China where potential suppliers are sent
questionnaires that cover working conditions and those being considered for
approval are inspected through on-site audits. Auditors are required to ask
if employees look to be over the local minimum age limit and to seek legal
advice if the answer is ‘no’. If a supplier fails to meet the standards
required, the audit team will notify the buyer within BP not to proceed with
the business.
We are putting in place a practice which recommends that projects should

investigate any allegations of child and forced labour among suppliers and
take appropriate action if there is evidence that the allegations are true.
Security and human rights
We continue to take action to embed the Voluntary Principles on Security

and Human Rights (the Voluntary Principles) within our projects and
operations.

Attestation
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Local communities
BP considers mutual benefit is key to

operating successfully within
communities
Our goal is ongoing consultation with local communities through the life of a
project to seek alignment between our business actions and project
development and the needs and aspirations of local communities.
Building relationships
We engage with communities in many different ways. For example, we may
hold open days, neighbourhood meetings and information events to explain
our work, or support local arts and cultural events.
Identifying and managing social issues

Our engagement with communities begins with a formal assessment of the
potential environmental and social impacts of a project, well before we
begin to have a physical presence. The aim is to build relationships with
those we identify as being affected by the project, and other stakeholders,
through early and continuing engagement, and responding to their
expectations and concerns.
We are putting in place a group-wide practice to integrate social

requirements alongside our environment requirements for new projects.
Process in action
Engaging local Inuvialuit communities was an early part of our Pokak 3D
seismic program in the Canadian Beaufort Sea. We gathered feedback
during the initial consultation and incorporated it into project planning which
helped the company execute a program beneficial to both the local
community and BP. For example, local Inuvialuit were trained and hired as
marine mammal observers to watch for whales and polar bears within the
safety radius of the vessels.
Attestation
Specific observation from Ernst & Young
During our interviews with staff dedicated to engaging with stakeholders we

saw evidence that processes are in place for identifying and engaging with
stakeholders at group and local levels. Furthermore, we saw examples
where material outputs from stakeholder dialogue had been used to inform
decision making. However, practices and documentation vary between
businesses and there is no formal process applied across the group to
monitor the effectiveness of engagement.
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Independent advisers
We sometimes work with independent

advisors to gain an insight into local
conditions and opinion. This data
informs our community engagement
programmes
Indonesia
The Tangguh Independent Advisory Panel (TIAP), which until early 2009
was chaired by former US Senator George Mitchell, published its seventh
report on the non-commercial aspects of the Tangguh liquefied natural gas
project in Papua Barat province of Indonesia, in March 2009. TIAP’s reports
have provided advice on the project’s impacts on the local community and
environment, including such topics as security, employment, education and
health. In the 2009 report, TIAP noted that support for the project remained
strong among both Papuan and local leaders. It said that, although some
complaints exist, there was near unanimous appreciation for the
consultations among Papuans with whom BP has engaged, as well as for
the specific tangible benefits that the project has brought to the area,
including improved health care, education, clean water, and economic
development for the villagers. It noted that tensions between north and
south shore villagers, as well as opposition to the project from some north
shore residents have eased somewhat as better infrastructure and other
benefits accrue to the north shore.
In response, BP said that it would act in line with several TIAP

recommendations. For example, it would strengthen basic education with
increasing emphasis on assistance at the secondary and tertiary levels, and
conduct a new survey of fish stocks after the start of operations to assess
the impact of Tangguh operations on fishing. In July 2009 BP announced
the new TIAP lineup chaired by former US Senator Chuck Hagel in
Washington DC and Augustinus Rumansara in Jayapura. The new TIAP’s
focus will be to offer advice to BP on developments, and on the
performance of the non-commercial aspects of the project - while not
duplicating the existing Tangguh Lenders Group’s independent external
review procedures.
Trinidad & Tobago
We work with a small advisory council of business and academic leaders in

Trinidad & Tobago. It provides useful insight and advice on how our
business decisions or changes in our operations may be perceived
externally, while offering opinions on how social, economic and political
changes in the external environment may affect our operations. The council
has also been instrumental in helping BP Trinidad & Tobago to shape its
corporate responsibility programmes, ensuring that we are making
meaningful contributions to the development of the country.
Attestation
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Customers
BP tracks customer satisfaction with our brand and

products through interviews and feedback
mechanisms, and makes sure that our marketing
efforts are undertaken responsibly
Customer programmes
We conduct formal global programmes addressing customers’ satisfaction
levels and their awareness and familiarity with the BP brand.
The customer satisfaction programme focuses on how consumers

rate BP against our competitors. In 2009 this study was based on
feedback from about 56,000 customers in 17 countries.
The brand health programme assesses customers’ awareness and
familiarity with our brand compared to those of our competitors, and
the extent to which they show a preference for it and take action as
a result. The health of our brand depends on the degree to which
customers recognize it and use our products, as well as their
perceptions of our reputation. In 2009 around 85,500 brand health
consumer interviews were held in 17 countries.
Data from these surveys is analyzed, and then compared across markets
and over time. The results are fed back formally to individual businesses,
providing insight into current trends in customer satisfaction and brand
health across a range of indicators.
Responsible marketing
We make sure our brands and products are marketed in a responsible way,
in line with our group values. Our current programming guidelines promote
consistency across the group’s brand communications in advertising,
marketing, promotion, sponsorship and public relations.
Compliance with these standards is monitored through a series of steps:
Legal review and sign-off is required before any significant external

communications are launched.
Senior marketing leaders monitor our communications activities to
make sure they are on brand, on message and in line with other
prevailing standards.
Before airing, all BP advertising is submitted to locally relevant
authorities, such as the Radio Advertising Clearance Centre in the
UK, to ensure it complies with relevant broadcasting standards. BP
is also a member of industry trade associations, such as ISBA in
the UK and the Association of National Advertisers in the US, to
keep abreast of industry laws, standards and voluntary codes that
could affect our marketing activity.
BP currently employs WPP agencies Ogilvy & Mather and
Mindshare for most of its advertising, sponsorship and promotional
activity. Their contracts require them to comply with all applicable
laws and practices.
Ongoing advertising and brand health tracking means we also know what
our customers think of the way we tell the world about our products and our
company. Feedback channels, including this website, give customers and
others the opportunity to communicate their views to us.
Attestation
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Employees
Our employees are the eyes, voice and

ears of BP. Here’s how we share
information about what’s happening in
the business
Engagement with employees takes many forms, including team meetings,
multimedia communications, opinion surveys and other channels through
which individual concerns can be raised.
Internal communications
Effective internal communications at BP is about helping people to make

better business decisions based on their understanding of context, priorities
and boundaries. All our communication activities exist to support business
delivery, with three key objectives:
Building trust and understanding

Enabling constructive dialogue with specific audiences
Enhancing access – to resources, people, markets, capital
Communications include magazines, intranet sites, DVDs, targeted e-mails

and face-to-face communication. These communications, along with
training programmes, are designed to contribute to employee development
and motivation by raising awareness of financial, economic, social and
environmental factors affecting our performance.
Consultation mechanisms
BP’s consultations with staff are designed to keep employees informed and
involved in the development of the organization. We believe good relations
depend on a wide understanding among employees of the direction the
business is taking and its consequences for people – examples being the
way business strategy affects talent management, and the way
performance is reflected in compensation.
To provide clarity on these issues, as well as more general consultation, BP
engages with staff on both an individual and collective level.
At the individual level, the formal one-to-one relationship between
employee and line manager is the main way in which BP and its
people interact. This is underpinned by the processes through
which the group manages matters such as performance,
compensation, training and development. One-to-one meetings are
held frequently during the year, with the mid-year and annual
assessment being formally recorded. These focus on optimizing
individual performance, for example by identifying individual skill
requirements and development opportunities.
Formal, collective level consultation is typically undertaken to
implement legal requirements in particular countries, to consult
around changes in terms and conditions. It is used extensively in
mainland Europe, but to a lesser degree in the UK and elsewhere
in the world.
Consultation is carried out through forums for specific groups of employees.

Our two European Works Councils cover:
Exploration and production employees in the UK and Norway

All other employees
These meet twice a year as well as having ad hoc meetings.
There are four forums in the UK, covering:
The North Sea business unit

Other exploration and production employees
All other employees
Pensions matters for all employees
UK forums typically meet three to four times a year as well as having ad

hoc meetings if necessary. In other European countries, forums are set up
in line with local employment legislation.
Agendas are usually driven by issues such as: HSE policies; changes in the
organization, especially those affecting jobs; new business initiatives; and
contractual changes. Union employees are involved in the formal collective
mechanism wherever it applies.
Surveys
We run an annual employee survey to monitor employee attitudes and

identify areas for improvement. Our 2009 survey, completed by around
33,000 employees, showed a clear year-on-year improvement in employee
satisfaction and support for BP’s strategic direction:
The overall employee satisfaction index increased by 6% to 65%

93% of participants felt ‘personally committed’ to supporting BP’s
priorities of safety, people and performance
There were particularly encouraging scores for internal
communications; awareness and understanding; commitment; and
confidence.
Areas highlighted for improvement include:
Listening to employees
Encouraging people to contribute ideas
Recognizing jobs well done
Employee satisfaction
Raising concerns
BP expects employees to abide by the code of conduct and to ask

questions or report any concerns they have about safety, environmental
performance, employment-related matters or other possible breaches of the
code of conduct.
The code of conduct advises employees with questions or concerns to

consider raising them with their line manager, their human resources
representative, the legal group or group compliance and ethics. Employees
can also use the group’s own internal grievance process, works councils,
staff consultation forums and trade unions.
Confidential helpline and external ombudsman
Employees, contractors or other third parties who have questions about the
code or are concerned that laws, regulations or the code of conduct may be
being breached, can also get help or raise concerns through OpenTalk, an
independent confidential helpline. In the US, staff can also contact our
independent US office of the ombudsman (USOO) and the Independent
Monitor who scrutinises BP’s market trading activity.
Individuals can contact OpenTalk anytime, using a multilingual telephone

line or via fax, e-mail or letter, 24 hours a day, seven days a week.
All OpenTalk contacts are initially handled by an independent organization

before being passed to a senior BP compliance manager, who will arrange
a response and, if appropriate, an investigation. The USOO’s call-taking,
investigation and response processes are similar to those of OpenTalk.
Any employee who in good faith seeks advice, raises a concern or reports
misconduct is following our code of conduct. BP will not tolerate retaliation
against that employee. Retaliation claims are taken seriously, investigated
and appropriate action is taken if retaliation is proven.
OpenTalk cases
Attestation
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Suppliers
BP engages with suppliers in a variety

of ways, including review meetings to
identify mutual improvements in
performance
BP’s ability to fulfil our corporate responsibility aspirations depends in part
on the conduct of our suppliers.
BP’s processes are designed to choose suppliers carefully, on merit,
avoiding conflicts of interest and inappropriate gifts and entertainment.
We expect suppliers to comply with all legal requirements and we seek to

do business with suppliers who act in line with BP’s commitments to
compliance and ethics, as outlined in BP’s code of conduct.
Our mechanisms for managing relationships with suppliers are focused on

strategy, building common ground, delivery and performance management.
We engage with suppliers in a variety of ways, including review meetings to
identify mutual improvements in performance.
Attestation
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Governments and joint initiatives
BP actively engages with local,

regional and international industry
bodies and governments
Extractive Industries Transparency Initiative
As a member of this body, BP works with governments, non-governmental

organizations, international agencies and other companies to contribute to
sustainable development and poverty reduction by increasing transparency
of revenue flows.
In 2009, Azerbaijan became the first country to achieve compliant status

under EITI. BP has been an active player in supporting the country level
efforts and we have consistently disclosed our disaggregated EITI
statements in our annual Azerbaijan Sustainability Report.
Voluntary Principles on Security and Human Rights
We continue to take action to embed the Voluntary Principles on Security

and Human Rights (the Voluntary Principles) – an initiative agreed between
governments, NGOs and the extractive industry – into our operations.
Action includes:
Creating a guideline to help our businesses implement the

Voluntary Principles more effectively and consistently, and integrate
them into our management systems
Adding a tool to our security management planning process that
helps our businesses assess the potential impacts of their security
arrangements on people and communities
Making guidance on the Voluntary Principles part of our
competency requirements for security professionals
Creating an e-learning module to help support learning and
development
Industry organizations
We are members of organizations that are aligned with our social and
environmental objectives, including:
The International Association of Oil and Gas Producers helps us to
share knowledge and experience with other companies involved in
running and appraising environmental and social impact
assessments
The World Business Council for Sustainable Development is
concerned with the role of business in development. BP served as
the project co-chair (along with Toyota) on the Mobility for
Development project to research the state of mobility in rapidly
growing cities at various stages of economic development
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BP memberships
Azerbaijan
— Anglo American Society (through BP America)
— US-Azerbaijan Chamber of Commerce (through BP America)
— Society of Petroleum Engineers (through BP group)
— American Chamber of Commerce
— British Business Group
— American Chamber of Commerce
Biofuels
— Advanced Biofuels Association (US)
— American Petroleum Institute (API)
— Biotechnology industry organization (BIO)
— Council on Sustainable Biomass Production
— European Petroleum Industry Association (EUROPIA)
— European American Business Council (EABC)
— European Biotechnology Association - EuropaBio
— International Petroleum Industry Environmental Conservation Association
(IPIECA)
— Biofuels Task Force
— Low Carbon Vehicle Partnership - UK
— Roundtable on Responsible Soy (RTRS)
— Roundtable on Sustainable Biofuels
— Roundtable on Sustainable Palm Oil (RSPO)
— Western States Petroleum Association (WSPA)
— Better Sugarcane Initiative
— UK Renewable Energy Assocation (REA)
Brand & Communications

— Association of National Advertisers, Inc - ANA
— Marketing Research Executive Board
— WFA
— ISBA
Climate change
— International Emissions Trading Association - IETA
— International Petroleum Industry Environmental - IPIECA
— United Nations Global Compact - UNGC
Compliance and ethics
— Ethics Resource Council (ERC)
— Compliance & Ethics Leaderhip Council (CELC)
— Ethics and Compliance Officer Association (ECOA)
— Institute of Business Ethics (IBE)
— Society of Corporate Compliance and Ethics (SCCE)
— Greater Houston Business Ethics Roundtable (GHBER)
Governance
— European Corporate Governance Institute (ECGI)
Health
— Global Business Coalition on HIV/AIDS, TB and Malaria (GBC)
— OGP International Petroleum Industry Environmental (OGP & IPIECA)
— American Petroleum Institute Standards - API, Fatigue Management
Committee
Indonesia
— Indonesian Petroleum Association (IPA)
Process safety
— API subcommittees
— American Petroleum Institute Standards - API, Safety Management
Committee
— Center for Chemical Process Safety (CCPS)
— Energy Institute
— European Process Safety Centre (EPSC)
— Explosion Research Cooperative
— Fire and Blast Interest Group
— IChemE, International Process Safety Group
— IChemE, Safety and Loss Prevention Subject Group
— International Association of Oil & Gas Producers (OGP)
— Mary K. O’Connor Process Safety Center
— UK HSE linked Buncefield Process Safety Leadership Group
— United Kingdom Petroleum Industry Association (UKPIA)
Procurement and supply chain

— Chartered Institute of Purchasing and Supply
— IACCM
Product Stewardship
— American Petroleum Institute (API)
— Asphalt Institute
— Cefic - European Chemical Industry Council
— CONCAWE - the oil companies’ European organization for environment,
health and safety
— Eurobitume
— European Petroleum Industry Association (EUROPIA)
— OECD New Chemicals Task Force
— Strategic Approach to International Chemical Management (SAICM)
— Synthetic Organic Chemical Manufacturers Association (SOCMA)
— The Business and Industry Advisory Committee to the OECD (BIAC)
— ECETOC
— United Kingdom Petroleum Industry Association (UKPIA)
Safety & Environment

— Global Reporting Initiative (GRI)
— International Petroleum Industry Environmental (IPIECA)
Security
— Extractive Industries Transparency Initiative (EITI)
— Institute of Information Security Professionals
— International Association of Oil and Gas Producers, Security Committee
— Energy Security Council
— American Petroleum Institute (API) General Committee on Security
— National Petrochemical Refiners Association Security Committee
— American Society for Industrial Security (ASIS) Oil and Gas Security
Commitee
— Voluntary Principles on Security and Human Rights (VPHR)
Shipping
— Shipping Emissions Abatement and Trading (SEAaT)
— Oil Companies International Marine Forum (OCIMF)
— Intertanko
— Singapore Shipowners Association (SSA)
— Australian Shipowners Association (ASA)
— The UK Chamber of Shipping
— The US Chamber of Shipping
— BIMCO
— P&I
Sustainable transport
— Forum for the Future
— World Business Council for Sustainable Development (WBCSD)
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NGOs and opinion formers
Discussing relevant issues with NGOs

and opinion formers deepens our
insight into the concerns of people
affected by our business, and informs
our policy-making
We work in partnership with NGOs, combining our skills, experience and
knowledge with theirs. We engage with NGOs at a local and global level, in
areas such as:
Consulting with them and offering our perspective on specific

projects or issues such as climate change, alternative energy and
fuels, governance of oil wealth, education, enterprise and human
rights
Working on shared programmes
Seeking their expert challenge on our social and environmental
performance of specific issues
Understanding external perceptions of a new project we are
planning
Opinion formers
We undertake research with key opinion formers to help us understand and

track BP's reputation. Interviews cover a wide range of issues, such as
environmental responsibility, community impact, human rights, transparency
and leadership.
The research also compares BP's overall reputation with that of other major
companies, both within and outside the oil and gas sector. Key findings are
reviewed by senior management and also, on occasion, by BP’s board.
Attestation
Specific observation from Ernst & Young

During our interviews with staff dedicated to engaging with stakeholders we
saw evidence that processes are in place for identifying and engaging with
stakeholders at group and local levels. Furthermore, we saw examples
where material outputs from stakeholder dialogue had been used to inform
decision making. However, practices and documentation vary between
businesses and there is no formal process applied across the group to
monitor the effectiveness of engagement.
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Security and continuity
BP’s security risk management strategy

aims to provide a secure working
environment for every member of the
workforce
A robust security strategy requires consistently implemented processes to
identify, assess and manage risks, and the development of plans and
contingencies to mitigate exposures to BP's people, operations and assets.
We’ve included mandatory practices in our group standard on security since
2006. Key requirements of the standard, such as systematic identification of
security hazards, development of security management plans, and
implementation of processes for the workforce to securely handle classified
or proprietary information, have been integrated during 2009 into BP’s
operating management system.
Security risk management
Effective security risk management involves collecting and making the best
possible use of the information available to us. BP’s team has continued in
2009 to work to improve the way we collect, assess and provide relevant
and timely information to better inform businesses on risk in order to assist
security and continuity planning.
Throughout the year we assess ongoing and emerging threats to the safety
and security of our assets. Recent examples include issues such as piracy
and risks to shipping in the Gulf of Aden and the Gulf of Guinea. At a
strategic level, BP avoids known areas of pirate attack or armed robbery;
where this is not possible for trading reasons and we consider it safe to do
so, we will continue to trade vessels through these areas, subject to the
adoption of heightened security measures.
We have been supporting the security of BP personnel in Iraq, in light of

BP’s signing of a technical services contract for the Rumaila field near
Basra in November 2009. We carry out security reviews and assessments
of key risks, facilitate security training for staff on working in potentially
hostile environments, and provide advice and assurance on the selection of
private security contractor support.
We have been providing security support for Castrol, one of the principal
sponsors of the 2010 Football World Cup in South Africa. This has included
carrying out security reviews of locations that staff and guests will visit
during the tournament, such as stadiums and hospitality venues, and
advising the Castrol leadership team on security requirements for
sponsorship events. We have also sought opportunities to share information
and coordinate communication with other corporate sponsors, taking a lead
in setting up a sponsors’ forum and establishing links with the South Africa
Police Service and FIFA security.
We continue to work with government authorities on measures to improve

the security of critical energy infrastructure that we operate. In the US, BP’s
security team assists businesses in preparing for compliance with
government regulation on security requirements at petrochemical sites,
ports and waterways. Work will continue in 2010 on submitting security
plans for certain sites for Department of Homeland Security approval.
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We continue to take action to embed

the Voluntary Principles on Security
and Human Rights (the Voluntary
Principles) within our operations
We work to implement the Voluntary Principles in locations based on our
assessment of any potential human rights risks associated with the
operating environment and with the security arrangements for our business.
A tool to support this work is BP’s implementation guideline on the
Voluntary Principles. This aims to make implementation more effective and
consistent by providing practical tools and integrating them into BP’s
management systems.
For example, we have incorporated into our security management planning

process a tool to help businesses assess the potential impacts of their
security arrangements on people and communities. We have inserted
guidance on the Voluntary Principles into our competency requirements for
security professionals and created an e-learning module to help support
learning and development.
Training and education relating to the Voluntary

Principles
A focus of activity in 2009 has been support for Voluntary Principles-related
training for our private security providers so that they can provide the
highest standards of professional service on the ground. We contracted a
specialist training consultancy to provide a ‘train the trainers’ course for
security guard supervisors working for our operations in Pakistan. The five-
day programme included instruction on negotiation and de-escalation
strategies, and on international standards on the use of force.
In Turkey, we delivered an awareness workshop for managers from ‘BILSA’

– the guardforce contractor for the Baku-Tbilisi-Ceyhan (BTC) pipeline in
Turkey. This included case studies on community engagement and
guardforce training. During 2009 BILSA and Securitas (which provides
guard services for other BP-operated sites in Turkey) provided repeat
training for guards on the Voluntary Principles, based on a curriculum
developed for them by BP.
In Georgia, we provided refresher training for private guards in three
workshops. The sessions were designed to develop the guards’
understanding of the need for restraint in response to potential security
threats, and to enhance their knowledge of international standards, relevant
Georgian legislation and BP’s own principles on human rights.
In Colombia, we continue to support education for public security in

international humanitarian law (IHL), though our sponsorship of the IHL
military training track in Cupiagua. Training at the facility combines
classroom time and re-enactment of situations through role play. Since
inauguration of the facility in 2003 more than 20,000 soldiers have gone
through the training.
In 2009, we supported a four-day workshop in Colombia on Human Rights

and International Humanitarian Law. It was organized by the Faculty of Law
of the Nueva Granada University, and included sessions on the
implementation of the Rome Statute of the International Criminal Court in
the Andean region. It was attended by more than 100 public security
officials, including senior officers from the military and human rights advisers
to the military, and lectures were provided by national and international HR
and IHL experts and teachers.
In Azerbaijan, we delivered refresher training on the Voluntary Principles for

private security guards working at BTC facilities. Workshops were delivered
at several locations, involving more than 150 guards. The goal was to
develop their skills in communicating effectively with external stakeholders,
to build their understanding of the need for restraint in response to potential
security threats, and to enhance their knowledge of international standards,
relevant Azerbaijani legislation and BP’s own principles on human rights.
BP also supported Voluntary Principles-related training for 62 private
security guards employed by Azerbaijan’s state-owned oil company
SOCAR, who are assigned at the BP-operated supply based near Baku.
In 2009, BP's Tangguh security team participated in a second joint training

exercise with the Papua police. The exercise included training on
proportionate response to civil disturbances, and involved 100 police
officers and 30 security guards. The event also involved Indonesian military
personnel in a table-top exercise. Observers included representatives from
local non-governmental organizations, and senior officials from the police,
military and local government and national oil and gas sector regulator.
Stakeholder engagement
We continue to seek opportunities in Azerbaijan to exchange information

with community stakeholders regarding the security arrangements in place
for facilities and pipelines. One mechanism used is Interagency Security
Committees. From 2006-09, BP held more than 200 meetings in
communities along the Baku-Tbilisi-Ceyhan pipeline. These were attended
by BP community liaison officers and security advisers, local government
leaders, land owners and users, and public security officials. In 2009, BP
commissioned a survey of more than a thousand people living and working
close to the pipelines in Azerbaijan. The study assessed attitudes to BP’s
performance on security, as well as stakeholder communication and
community investment. The results indicate a reasonable level of
awareness of the Interagency Security Committees, with around a third of
respondents stating they knew of them, and a positive view toward public
security providers for the pipelines.
Monitoring and evaluation
The Azerbaijan Social Review Commission published in 2009 its third report
on BP’s economic and operational impacts in Azerbaijan, including its
performance on the Voluntary Principles. The commission stated it was
“very impressed by the internal work undertaken by BP personnel to
promote implementation of the Voluntary Principles,” while emphasizing its
view of the importance of BP remaining “constant in its support for the rule
of law and internationally-recognized human rights.”
In 2009, the Tangguh Independent Advisory Panel (TIAP), which advises

BP on the economic, political and social impacts of the Tangguh LNG
project in West Papua, published its seventh report. The panel’s scope
includes providing external advice on BP’s performance in identifying and
managing human rights risk relating to security arrangements. In its report,
the panel made recommendations such as BP seeking to engage more with
the military in the area but noted that BP’s ‘integrated community based
security’ approach, involving the employment and training of local Papuans
as security guards and support for human rights-based training for the local
police, “is becoming a model in Indonesia”.
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Shareholders
We recognise our responsibility to our

shareholders by consulting, informing
and communicating with them in ways
that extend beyond our statutory
obligations
BP has more than one million shareholders worldwide. They have the
opportunity to propose and vote on resolutions, and attend our annual
general meeting (AGM) where they can pose questions to our directors.
Information about our business activities, progress and prospects is made

available to shareholders via our published corporate reports and on this
website. We also engage with them on the social and environmental
aspects of our activities. Non-financial subjects covered in recent
discussions include:
Status of the implementation of our operating management system,

as well as overall safety and integrity performance
The evolution of our internal process to manage environmental and
social risks for new projects
Developments in our low-carbon business and technologies
(particularly biofuels)
BP’s investment in the Canadian oil sands
Under English law, shareholders can table resolutions at our AGM

mandating action by the board, provided that they send a request to the
company to table such a resolution that satisfies the relevant legislation. If a
request which meets these requirements is received by the company by 21
January in a given year, BP will meet the costs entailed in circulating the
resolution to members for the forthcoming AGM.
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How We Operate

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How We Operate

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BP Sustainability

15 April 2010 bp.com/pdfdownloads

This download of selected pages from our full online Sustainability

Meeting the energy demands

BP operates globally according to a

The board is responsible for the direction and oversight of BP p.l.c. on

SEEAC monitors non-financial risk, which includes regular reviews of

Managing the business

BP utilizes a comprehensive set of management systems, organizational

BP’s code of conduct and values demonstrate our commitment to integrity,

The GCE’s senior team – known as the executive team – is supported by

People management is based on performance objectives through which

Clear lines of communication exist for the provision of relevant information

Ernst & Young's assurance statement

Legal Notice | Privacy Statement © 1999-2010 BP p.l.c.

BP’s system of risk management is

Access and renewal

Prices and markets

Climate change and carbon pricing

Liquidity, financial capacity and financial exposure

Compliance and control risks

Ethical misconduct and non-compliance

Liabilities and provisions

Drilling and production

Major project delivery

Business continuity and disaster recovery

Crisis management plans and capability are essential to deal with

People and capability

Treasury and trading activities

Ernst & Young's assurance statement

Legal Notice | Privacy Statement © 1999-2010 BP p.l.c.

BP’s operating management system is

OMS elements of operating

The system’s elements of operating describe eight dimensions of how

Our performance improvement cycle is at the heart of OMS, driving and

Delivering OMS locally

Ernst & Young's assurance statement

Legal Notice | Privacy Statement © 1999-2010 BP p.l.c.

BP is committed to respecting human

Supplier and human rights

We are putting in place a practice which recommends that projects should

Security and human rights

We continue to take action to embed the Voluntary Principles on Security

Security and human rights

Ernst & Young's assurance statement

Legal Notice | Privacy Statement © 1999-2010 BP p.l.c.

BP considers mutual benefit is key to

Identifying and managing social issues

We are putting in place a group-wide practice to integrate social

Ernst & Young's assurance statement

Specific observation from Ernst & Young

During our interviews with staff dedicated to engaging with stakeholders we

Legal Notice | Privacy Statement © 1999-2010 BP p.l.c.

We sometimes work with independent

In response, BP said that it would act in line with several TIAP

Trinidad & Tobago

We work with a small advisory council of business and academic leaders in

Ernst & Young's assurance statement

Legal Notice | Privacy Statement © 1999-2010 BP p.l.c.

BP tracks customer satisfaction with our brand and

The customer satisfaction programme focuses on how consumers

Legal review and sign-off is required before any significant external

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