It is hard to believe that a country is barely able to defeat a company. However, this is true with Ecuador, the country that has been wrestling with a U.S. Titan of industry---Chevron for 16 years.
This crisis came to my sight because of the Exxon Valdez case. Exxon took immediate responsibility for the spill and now the company still take 1989 Valdez Oil Spill as "a tragic accident deeply regretted by the company". The company also puts together information about the crisis on their website and updates information (the latest update is released on March 19th, 2009).
In contrast to Exxon, No. 1 large corporation in U.S., Chevron reacted differently to the oil contamination problem in Ecuador. The legal battle has been dragged on for 16 years, and thus this yet-on-going crisis has a longer time line than many other ones we may read in this blog. I would like to use a visual to display the stages of this crisis (See Pic1).
From the picture, the time line should be shortened from effective PR practices (such as timely response to crisis), thus possible negative effects of the crisis could have been mitigated (such as apology and bolstering). Moreover, Chevron involved in multiple parties of stakeholders (residents in Ecuador's contaminated areas; customers; Petroecuador corporation; Texaco; Ecuador and U.S. Governments; Board members and employees; U.S. oil industry), which could influence PR practices. For example, news releases should consider victims in Ecuador as the 'utterly important' audience.
Apparently what we learn from this class can explain the oil giant's reactions, due to space constraint, I will discuss their apologia strategies. Chevron attributed the oil contamination to Petroecuador's responsibilities, however, it was Texaco (now Chevron) that did all the operations. Chevron attempted to shift blame (if not the entire blame) to the contamination to Petroecuador. Petroecuador became the scapegoat. Although this nation-owned entity could take some accountability in this case, Chevron is being sued for the contamination it caused as operator and the contamination caused by these operations. The contamination in soils and waters continues after the operations stop and even worsens year after year by mitigating further into soils and groundwater.
Scapegoating is part of the differentiation in apologia prototypes (Hearit), and denial in Coomb's crisis responses. It is even risky to attack the accuser. Recently Chevron published a video indicating a bribery scheme that was to include the sister of Ecuador's President, Pierina Correa, and Judge Juan Núñez, who was then overseeing the case. The ostensible reason Chevron disclosed this video was to convince people to doubt on the integrity of Ecuador's legal system, while its real goal is to attack the accuser and further denying any wrongdoing in oil contamination. "The tapes were the latest turn in a legal marathon over oil contamination left by Texaco years before it was acquired by Chevron". On one tape, Judge Núñez seemed plan to rule against Chevron and increase the compensation to more than $27 billion, making it potentially the biggest environmental lawsuit in history. While this bribery scheme was discussed, the taping action also caught media attention since taping conversations without everyone’s permission is illegal in Ecuador, and trying to bribe foreign officials is illegal under American law. That is to say, the denial strategy may have brought new trouble for Chevron: how they got the video and how they justified the content in the video.
Besides its present strategy of counterattacking credibility of the accuser, we can also see a combination of differentiation and scapegoating in its previous responses. A typical one is Chevron's so called "remediation" back in 1995. With a real purpose to dismiss the lawsuit pending in U.S. federal court, Texaco (now Chevron) offered $40 million to trade for a legal release from Ecuador's government for any environmental claims they had against the company. However, the remediation covered less than 1% of the actual damages with a focus on merely 15% of 916 waste pits Texaco had built. Meanwhile, Texaco sought the release even though it claimed it had not caused environmental damage. This response to the crisis was a bad decision of the management and PR, although Texaco seemed have taken a proactive action on it. Later came the contamination results from the pits Texaco claimed as remediated. No difference from untouched pits, and thus two Chevron lawyers and seven former Ecuadorian government officials are now under criminal indictment for lying about the remediation results. In this case Chevron used a few apologia strategies to look good, while the company failed to maintain authenticity and openness during its PR practices. Other than that, its flawed evidence (such as bribe tapes and remediation measures) was not vigorous and compelling defense (Hearit) for avoiding blame. The trial is expected to have a decision by the end of this year, and we can keep an eye on how Chevron PR will do next.
I really hope justice will be served and Chevron will have to pay for the damages in Ecuador. So far, no relief has been offered to the Ecuadorians suffering from the contamination. Chevron has said on many occasions it won't pay even if found guilty in court. What arrogance!!!
Here's an interesting blog: http://www.thechevronpit.blogspot.com
Posted by Anna on October 18, 2009 at 09:14 PM EDT #
Even if the Newsweek magazine Dr. Johnson showed us this Tuesday, Chevron was ranked 371 out of 500 there, way ahead of Pepsi, Time Warner Cable, etc.! That brought me back to examine what criteria Newsweek used to get the ranking?
Posted by Jing on October 21, 2009 at 11:30 AM EDT #