Corporate Responsibility and Ethics at BHP Billiton

This report highlights the CSR initiatives and ethical standards of BHP Billiton. BHP Billiton is in the mining industry and it has been controversial for CSR activities. The report discusses Carroll’s CSR Pyramid and Wartick and Cochrane’s Typology. BHP Billiton takes the actions to lower the carbon footprint and reduces the environmental impact as well.

Running head: CORPORATE RESPONSIBILITY AND ETHICS
Corporate Responsibility and Ethics
Assessment 4- Individual Business Report
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Executive Summary
This report highlights the CSR initiatives and ethical standards of BHP Billiton. BHP Billiton
is in the mining industry and it has been controversial for CSR activities. In the first part of
the report, Carroll’s CSR Pyramid and Wartick and Cochrane’s Typology has been discussed.
BHP Billiton takes the actions to lower the carbon footprint and reduces the environmental
impact as well. BHP Billiton has been in the partnership with Conservation International
since 2001 to support the efforts on biodiversity and conservation, both within operations and
more broadly. In addition, BHP Billiton donates almost 1% of its pre-tax profits to
community programme in order to improve the standard of living. BHP Billiton has its
internal audit agency to monitor and review the CSR report. BHP Billiton follows the
Corporate Human Rights Benchmark as well. BHP Billiton is not only fosters the strong
relationship local communities. In order to improve the community; they do the reduction of
the energy use and they take the collaborative approach. . BHP Billiton faced the issue of
dam holding back waste water from the iron ore mine in Brazil. BHP Billiton works with
integrity, safety and it demonstrates the commitment towards the shareholders and
stakeholders. BHP Billiton Foundation does the charity of making the education helpful to
unlock the talent of the young people and they have natural resource governance to raise the
standards of governance. Therefore, BHP Billiton can take the measure for betterment of the
community and environment through lowering the environmental impact.

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Table of Contents
1. Introduction............................................................................................................................3
2. Concept of CSR......................................................................................................................3
3. Environment...........................................................................................................................4
4. Human rights..........................................................................................................................6
5. Governance............................................................................................................................7
6. Company’s record on philanthropy........................................................................................7
7. Conclusion..............................................................................................................................8
Reference List............................................................................................................................9

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1. Introduction
BHP Billiton is an Anglo-Australian multinational company that was created through
the merger of BHP and Billiton in the year 2001. The headquarters of BHP Billiton are at two
places; Melbourne and London. This organisation is ASX listed company and it mainly deals
in mining, petroleum, metals, iron ore, copper, natural gas, nickel and uranium (Bhp.com
2018). Revenue of BHP Billiton was US$ 38.286 billion in 2017 and number of employees
work in the organisation are 65,000.
The purpose of the report is to highlight the CSR initiatives and ethics taken by BHP
Billiton. The discussion of the report will be completely based on responses of BHP Billiton
to stakeholders’ expectation on corporate social responsibilities and human rights.
2. Concept of CSR
Carroll’s Model of CSR
Carroll defined the CSR pyramid with simple framework that states why and how the
organisations can meet the social responsibilities. Carroll’s pyramid has four distinct
responsibilities. First, economic responsibility is about making profit from the business and it
is the only way to exist in the business world. As stated by Carroll (2016), economic
responsibility gives benefits and it is the only path to survive in the society for long run.
Legal responsibility is to abide by the laws and regulation. Organisations must follow the
legislation in which business environment they are currently working. The legal
responsibilities of the organisations are to follow the laws regarding Competition Laws,
Health and Safety of the employees and Employment laws. Ethical responsibilities of the
organisations are to be ethical and follow the obligation to do what is right for the
organisation. The organisations in the business environment must be just and fair to avoid the

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harm. According to Capaldi et al. (2015), the ethical responsibility of the businesses is to go
beyond the requirements of the laws. Finally, philanthropic responsibility of the companies is
to return the society and this responsibility is mainly discretionary; however, this
responsibility is significance to improve the brand image of the organisations.
Wartick and Cochrane’s Typology
Wartick and Cochrane (1985) proposed the three-dimensional model of principles,
policies and processes. This concept is the integration of the principles of CSR, the policies’
of social issues management and the process of action into the evolving system. In order to
understand the social performance of the organisations; three views are significant, such as
the basic definition of the responsibility of the organisations regarding society, the issues
existent in social responsibilities and philosophy of responses. According to Grayson and
Hodges (2017), in order to understand the corporate social performance; the management of
the organisations need to understand the social issues to which these responsibilities are tied.
Social issues can evolve under the social responsibilities and the businesses must address the
social issues. Social involvement to solve the social issues are associated with five areas;
matching the social need, seriousness of social need, interest of top executives, public
relations, government pressure. As pointed out by Devin and Richards (2016), philosophy of
the business in response to social responsibility can be defined as social responsiveness.
Social responsiveness is about the organisations’ decisions regarding the social pressures.
3. Environment
BHP Billiton produces each year Sustainability Report Scope on the basis of
emissions calculation. BHP Billiton is in the mining industry and the organisation has to look
after the environment as this industry tends to harm the environment. BHP Billiton has been
in the partnership with Conservation International since 2001 to support the efforts on

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biodiversity and conservation, both within operations and more broadly. As published in the
book by Yakovleva (2017), BHP Billiton has implemented an integrated wellbeing and
quality of life programme for the workers so that they can live in the best environment. BHP
Billiton works in fossil fuel extraction and it is responsible for greenhouse gas emission. BHP
Billiton is responsible for cumulative emission as in the year 2014 at 8,789 MtCo2e and it is
represented almost 0.65% of global industrial emissions (Bhp.com 2018). BHP Billiton does
voluntarily reporting to the GHG emissions and this organisation was criticised for the
lobbying against the carbon pricing in Australia. In addition, BHP Billiton donates almost 1%
of its pre-tax profits to community programme in order to improve the standard of living. In
order to reduce the carbon footprint, BHP Billiton established and co-founder of Bush Blitz
with Australian Government to help Australian Biological Resources Study. BHP Billiton
takes the approach to environmental management on the basis of robust identification, control
and assessment of material risk across all phases of the business (Frederick 2018). In case of
the climate change, BHP Billiton focuses on decreasing the greenhouse gas emission and
energy use at the operation process. Managing water is a complex task due to range of water-
related risks and the possible impacts on water resources, communities and bio-diversities.
BHP Billiton has Environmental Resilience Framework to build on existing conservation and
REDD commitments by contributing to enduring environmental outcomes through water
stewardship, biodiversity conservation and climate change.
BHP Billiton is committed to high ethical business practices and governance
standards. BHP Billiton provides detail operational, community and environmental
information for the local governmental stakeholders. This organisation has its committee to
monitor the progress of environmental factors as it has different departments and agencies of
regulatory information in Coal, Petroleum, Copper and Iron Ore. There are two types of

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sustainable reporting; web-based report and summary report published by the organisation
following the Global Reporting Initiative (GRI).
4. Human rights
BHP Billiton has taken the initiatives in line with the company charter and the culture
of care, the organisation has undertaken the activities to enhance the mental and physical
wellbeing of the people. BHP Billiton has worked hard over the past few years to simplify
and roll out health and safety of the employees and communities to control across the assets.
BHP Billiton is one of the members of UN Global Compact and this organisation is the
supporter of Extractive Industries Transparency Initiative. BHP Billiton follows the
Corporate Human Rights Benchmark as well. BHP Billiton is not only fosters the strong
relationship local communities; however, this organisation tries to provide better society in
international level. It has taken the initiatives to develop the opportunity provided by mineral
resources and they continue to prosper in delivery of the demand. In order to deal with the
climate change, BHP Billiton achieves the meaningful reduction in energy use to recognise
the significance of playing societal responsibility (Tai and Chuang 2014). BHP Billiton has
taken collaborative approach to improve the condition of the society and the stakeholders to
ensure the sustainable future in all the activities.
BHP Billiton has some issues regarding not following of the CSR and the
development of the society and environment. BHP Billiton faced the issue of a dam holding
back waste water from the iron ore mine in Brazil. BHP Billiton took the improvement
actions to ensure that it meets the highest ethical standards in all dealings. This is consistent
with the charter values.
BHP Billiton is fully committed to working with integrity and it has been following
the Code of Business Conduct specially prohibits the engaging in unethical behaviour. BHP

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Billiton works with integrity, safety and it demonstrates the commitment towards the
shareholders and stakeholders through processes and actions. The organisation always looks
out to learn and seek for the scope to develop (Linnenluecke et al. 2015).
5. Governance
BHP Billiton follows the philosophy of governance that goes beyond the compliance.
The organisation believes in high-quality governance that supports the long-term value
creation that can put good governance in good values. The structure of the corporate
governance allows the interaction between the shareholder and the Board; the relationship
between the Board and the CEO. The robust process helps to ensure the delegation flows
through the Board and its committees towards the CEO, Operation Management Committee
and the Executive Leadership Team. This communication process assists to ensure the
alignment with shareholders and they have responsibility for day-to-day management. OMC
has the responsibility for controlling, planning and directing of the activities (Kraakman and
Hansmann 2017). BHP Billiton follows the Charter as part of the corporate governance
framework and it embodies the corporate purpose.
BHP Billiton does not have the issue of dilemmas and contradictions in business that
can lead to the dilemma for the managers as there can be conflict between societal outcomes
and business performance. Social outcomes can be part of the protecting of the environment
and protecting of the employees in BHP Billiton. In the year 2015, BHP Billiton hit almost
$25m fine for the corruption allegation in corporate governance (Rupp et al. 2015).
6. Company’s record on philanthropy
BHP Billiton Foundation has been working to address some of the critical global
sustainable development challenges that are facing the generation. The organisation works in

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partnership to find the new solutions and set new ethical standards for the future. BHP
Billiton Foundation does the charity of making the education helpful to unlock the talent of
the young people. BHP Billiton does the natural resource governance that raises the standards
of governance and transparency to ensure the wealth created by the global resources.
According to Schwartz (2017), BHP Billiton has resilient environments for the sustain
peoples’ culture, food security and livelihood to combat the climate change and underpin the
thriving society around the world. BHP Billiton shows the quality education through which
the people can build the skill and knowledge to seize the opportunity towards improvements
of lifestyle and enhance the communities and societies.
7. Conclusion
CSR has already become the major concern in global mining economy as the
heightened awareness of unethical business. BHP Billiton has the CSR policy that prohibits
the impact of government officials and BHP takes the measure for the protection of the
environment, workplace health and safety and effectiveness of public relations. Therefore,
BHP is in the controversial industry and BHP takes the measure for betterment of the
community and environment through lowering the environmental impact. Stakeholders of the
business demand the accountability to verify transparency.

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Reference List
BHP Billiton. 2018. Environment and Corporate Social Responsibility. [Online] Available at
https://www.bhp.com/environment [Accessed 17th Jun 2018]
Capaldi, N., Schmidpeter, R., Zu, L. and Fifka, M.S., 2015. Dictionary of corporate social
responsibility CSR, sustainability, ethics and governance. Berlin: Springer.
Carroll, A.B., 2016. Carroll’s pyramid of CSR: taking another look. International journal of
corporate social responsibility, 1(1), p.3.
Devin, B. and Richards, C., 2016. Food waste, power, and corporate social responsibility in
the Australian food supply chain. Journal of Business Ethics, pp.1-12.
Frederick, W.C., 2018. Corporate Social Responsibility: From Founders to Millennials.
In Corporate Social Responsibility(pp. 3-38). Berlin: Emerald Publishing Limited.
Gerde, V.W., Cochran, P.L. and Welcomer, S., 2017. Power and Social Behaviour: A
structuration approach to stakeholder networks. In Unfolding Stakeholder Thinking 2 (pp. 83-
105). Routledge.
Grayson, D. and Hodges, A., 2017. Corporate social opportunity!: Seven steps to make
corporate social responsibility work for your business. Abingdon: Routledge.
Ioannou, I. and Serafeim, G., 2015. The impact of corporate social responsibility on
investment recommendations: Analysts' perceptions and shifting institutional logics. Strategic
Management Journal, 36(7), pp.1053-1081.
Kraakman, R. and Hansmann, H., 2017. The end of history for corporate law. In Corporate
Governance (pp. 49-78). Gower.

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Linnenluecke, M.K., Birt, J. and Griffiths, A., 2015. The role of accounting in supporting
adaptation to climate change. Accounting & Finance, 55(3), pp.607-625.
Rupp, D.E., Wright, P.M., Aryee, S. and Luo, Y., 2015. Organizational justice, behavioural
ethics, and corporate social responsibility: Finally the three shall merge. Management and
Organization Review, 11(1), pp.15-24.
Schwartz, M.S., 2017. Corporate social responsibility. Abingdon: Routledge.
Tai, F.M. and Chuang, S.H., 2014. Corporate social responsibility. Ibusiness, 6(03), p.117.
Yakovleva, N., 2017. Corporate social responsibility in the mining industries. Abingdon:
Routledge.