BHP Billiton Company: CSR Program, Issues, and Recommendations

This report provides an executive summary and detailed analysis of BHP Billiton's Corporate Social Responsibility (CSR) program. It identifies key issues such as mishandling of hazardous substances, non-effective regulatory compliance, and inconsistencies between domestic and international CSR policies, along with high employee turnover due to ineffective development plans. The report explores these issues, offering recommendations based on legitimacy theory, public relations, triple bottom line theory, and business ethics theory. It evaluates these theories, critiques them, and proposes an implementation plan to address the identified CSR challenges. The report also discusses potential issues that might arise after the implementation plan. It emphasizes the importance of stakeholder impact, evidence of CSR activities, and the need for harmonization between CSR programs and stakeholder concerns to ensure sustainable business practices. The report concludes with a comprehensive overview of BHP Billiton's CSR performance, challenges, and potential solutions, providing a valuable resource for understanding and improving corporate social responsibility within the company.

BHP BILLITON COMPANY
Corporate Social Responsibilities
CSR Program and issues faced by BHP
Name of the Student-

Executive summary
Each and every company needs to take proper CSR activities and comply with the all the
ethical and legal requirements if it wants to grow its business on sustainable basis. The Concept
of CSR is meant to allow company to give back to society what it has taken while running the
business. In this report, corporate social responsibilities issues recommendation to solve those
issues and way of solving the issues also along with the examples has been discussed. It will
assist owners and key managerial persons of BHP Billiton Company to understand the hindrance
and proper issue solving methods to mitigate these CSR issues in effective manner. This
company has faced the corporate social responsibilities issues in its business due to the
mishandling of hazardous substance and non-effective regulatory legal compliance. The main
CSR issue has emerged as company has failed to establish harmonization in its domestic CSR
policies and international CSR policies of company. In addition to this, company has also faced
issue in its high employee turnover due to the non-effective employee development plan. It is
also one of the biggest reasons of less complied CSR program.

Table of Contents
Executive summary.....................................................................................................................................1
Introduction.................................................................................................................................................3
Description of company...........................................................................................................................3
Research methods.......................................................................................................................................4
CSR issue identified and undertaken program of BHP Billiton.....................................................................4
Evidences.....................................................................................................................................................5
Stakeholder’s impact...................................................................................................................................6
Recommendation-.......................................................................................................................................7
Legitimacy theory....................................................................................................................................7
Public relation..........................................................................................................................................7
Evaluating of theories..............................................................................................................................7
Critise of theory.......................................................................................................................................8
Recommendations.......................................................................................................................................9
Triple bottom line theory.........................................................................................................................9
Business ethics theory...........................................................................................................................10
Evaluation of theories............................................................................................................................10
Critises of theory...................................................................................................................................11
Implementation plan.............................................................................................................................12
Issues after implementation plan..............................................................................................................14
Conclusion.................................................................................................................................................14
References.................................................................................................................................................16
Appendix...................................................................................................................................................19

Introduction
With the changes in ramified economic changes, every organization needs to follow
proper strategic program and compliance program to mitigate the social and environmental
issues. It is analyzed that organization operates its business in the society and has to manage it’s
all the business operations with a view to strengthen the business functioning in effective
manner. The corporate social responsibilities is also used as sustainable business, corporate
governance and self-regulatory compliance program of company to strengthen its social and
environmental safety program. In this case, BHP Billiton Company has been taken into
consideration to determine the CSR activities of the company. In many case, CSR activities have
been described as business approach of the company that contribute to the sustainable business
development by delivering the economic, social and environmental benefits for all of its
stakeholders. In this report, through analysis of Corporate social responsibilities of BHP
company, it has been taken which is used to maintain an effective strategic approach. In the CSR
activities of the BHP Billiton Company, it is considered that company has responded to
community expectations with combinations of the policy’s including code of conducts
sustainable development policy and other designed set of standards which conducts its business
for the effective business functioning (BHP Billiton, 2016). BHP has defined its CSR policies
and activities program as requirement to address risks and explicating the zero tolerance of the
Misconduct act upon the child labour, issue related to forced labour, and employee development
program and corruption, bribery and extortions.
Description of company
BHP Billiton Company is the world’s largest company which was formed in 2001 merging of the
Australian Broken Hill Proprietary Company, and Billiton of the UK. The main business
operation of company is related to production of ore, Manganese, Petroleum, Aluminum, Base
Metals, Metallurgical Coal, Thermal Coal, Stainless Steel resources, mine and
Diamonds/Specialty materials by using the natural resources (BHP Billiton, 2016).

Research methods
It is analyzed that the BHP Billiton Company’s scale of diversity is related to worst
ravage of the cotemporary economic downtown which negatively impacted the employees and
other owners of the company. However, there are major communication channels which have
been used by BHP Billiton Company such as reporting process, announcement, multimedia and
media feedbacks. The issue in the global and corporate accountability arises due to the non-
sustainable business practice and less effective business policy which might negatively impact
the society, economic and environment at large. In this research, the main research methods are
journals, articles, documents and other web news which have been used to collect the required
amount of information. However, qualitative and quantitative data have been collected to
determine whether the CSR activities of the company have created value to its stakeholders.
CSR issue identified and undertaken program of BHP Billiton
It is analyzed that business organizations hampers economic, society and environment while
operating its business and in order to mitigate these issues and payback to society, CSR program
and sustainable business practices are undertaken by organizations (BHP Billiton, 2016).These
activities are the most suitable methods which are used to implement the strategic approach and
implementing the strategic approach to manage its business. However, after assessing the annual
report of company, the main issue which has emerged due to the business functioning of BHP
Billiton Company is related to emergence of hazardous substances and gases which negatively
impact the society and environment at large. These hazardous gas and substances emerged due to
the functional program of exploiting the natural resources. It has high level of social pressure and
negatively impact the environment in which people lives.
It is analyzed that due to the financial crises of the business, BHP Billiton Company had to
dismissal all of its six thousand employees and contractors which eventually negatively impact
the society and environment at large. This CSR issue emerged due to the non-effective strategic
program and less effective CSR policies program of company. Company adopted CSR activities
with a view to promote business accountability to wide range of stakeholders besides

shareholders and investors who may have direct and indirect interest in the business organization
(Kirsch, 2008).
Another global CSR issue and sustainable program of company is based on the communication
and responsibilities program. Company has inclined towards opting for a utilitarian, relativist
interpretation of 'good and reflects the use of the relative efficiency to use the vast portfolio of
extractive activities in such a way that could be hard for the organization if takes more
obstructive stances. Nonetheless, company endeavored towards developing the economic and
social benefits CSR activities and standards which will assist management to mitigate the
negative impact of its business operations. BHP Billiton Company followed its set protocol and
discharged its all the CSR activities by implementing its strategic plans and investing capital in
the particular certain areas. However, after assessing the market details, it was found that BHP
Billiton Company failed to manage its negative impact on the concerned society which emerged
due to the excess use of iron ore and other hazardous substance (Kemp, Boele, and Brereton,
2016). The main issue of the CSR activities of the company has been emerged due to non-
effective employee development program. It has reflected that company has already set up the
grievance portal in its different department so that every employee could easily share their issues
and problem in the process system of organization.
The CSR program is the most suitable sustainable business practice which promotes each and
every organization to undertake strategic activities to deliver the best outcomes to society and
eliminate the negative impact of its business on society and environment for the sustainable
business practice. After analyzing all the details, it could be inferred that CSR program and
concern of the stakeholders should be harmonious which reflects that company endeavored
towards setting the harmonization for the social and economic development together (Hilson,
2011).
Evidences
These evidences are given to determine the CSR activities of the BHP billiton company and how
the CSR activities have impacted the stakeholders. These corporate laws and applicable CSR
policies should be followed by BHP Billiton Company to strengthen its CSR activities and

increasing the overall efficiency of the business. BHP Company has focused on following the
CSR strategy after happening of the disaster of the town of Bento Rodrigues. This issue was the
one of the most imperative trigger which forced BHP Billiton Company to set up proper CSR
program in its sustainable business program. In addition to this, the CSR reporting frameworks
of the BHP Billiton Company has been designed in such a way which strengthens the overall
CSR program and implemented strategic approach. It focused on the rendering the corporate
business benefits to society and lower down the negative impact of its business on others
(O’Neill, and Deegan, 2009). It reflected that this oil spill has negatively impacted the brand
image and business sustainability of the organization in long run. However, the another CSR
issue which BHP Billiton Company has encountered in this business process is based on the
harmonization of its domestic and international CSR policies and frameworks. It is analyzed that
CSR issues and increased business complexity has divulged that company has failed to managed
its CSR program and does not follow all the applicable CSR rules and regulation. In terms of
financial perceptive of the company, it also has to consistently invest at least 2% of its average
five year net profit which is too high and increases overall cost of its business (Haalboom, 2012).
Stakeholder’s impact
The main CSR issue of the BHP Billiton Company is related to their oil spills which have
negative impact on the society. In the past, this company has already faced several oil spill issues
and had negative impact on the environment and society at large. It has been observed that
despite of its bad history of the negative impact of the Brazil oil spill case, BHP Billiton
Company has faced high social and environmental issues in its business. In addition to this, the
BHP Billiton Company has faced issue in adopting the triple bottom line methods in its business
which may negatively impact the business cash outflow and increased business costing (Collins,
2009).After that incident of company in 2015 and 2016, it divulged in its reporting frameworks
that the increased investment in its Eco-logical system process and designed may mitigate the
environmental negative impact on the business.

Recommendation-
BHP Billiton should educate its stakeholders about materialistic and non-materialistic things so
that they could bifurcate the policies program designed by the company for the suitable future
growth and social development (White, 2017). Company may also seek to manipulate and mould
perception of the others by deflecting appeal to organization authority. It strengthens the
transparency of the work system and implemented strategic program of the work system to
implement the code of work program (Visser, 2016).
Legitimacy theory
As per the legitimacy theory, it is analyzed that company has been indulged in the production
and handling of the hazardous substance which may negatively impact the society and
environment. BHP Billiton Company has been indulged in oil, petroleum and mining program
which requires utmost care and good handling otherwise it may negatively impact the society
and environment at large.
Public relation
This theory focuses on the public relation. The public relation theory is followed to strengthen
the positive outcomes to society and lower down the negative impact of the business. This level
of strategic program adopted and its less effective CSR program have reflected that company
needs to arrange proper functional program to strengthen its CSR activities program in its
business. The public relation is also one of the major concern of the company which assists in
strengthen the transparency and reporting framework of organization.
Evaluating of theories
These different theories have been adopted to make the business practice of company
more effective and clients oriented. BHP Billiton Company has adopted international CSR
reporting frameworks to strengthen its CSR program. The public relation program and
transparency of its business and financial transactions are highly based on the CSR reporting
frameworks and international harmonized framework. The Eco system support installed by
company is done to improve its eco-management program and improving the overall social and
development supporting program. These all the identified issues have reflected that BHP

Billiton Company needs to manage its business effectively and CSR program and effective
compliance program is also required to strengthen its business in long run (Jones, Marshall, and
Mitchell, 2007). It is analyzed that BHP Billiton company has perceived the legitimacy theory
and in order to strengthen its CSR policies, it has to adopt of the several strategies and corporate
governance program (Kemp, 2009).
Critise of theory
Company needs to implement the level of legitimacy theory which will ensure the arraignment of
the institutional level which might positively impact the corporate governance practice of
company in long run (Ross, 2017).
Source: (Bair, and Palpacuer, 2015)
The non-effective legal and ethical compliance issues faced by company have reflected that
company needs to follow the proper work practice and implement the strategic program. These
practices not only strengthen the regulatory compliance of company but also increase the overall
regulatory requirement compliance on international level as well. After analyzing all these
details, it could be inferred that BHP Billiton Company indulged in handling hazardous

substance and mineral which if not taken properly under care then it might negatively impact the
people and environment at large. Minas Gerais state environmental prosecutor has also declared
that company has failed to comply with eh applicable CSR program and rendered its business
non-effective. In addition to this, BHP Billiton company needs to manage its compliance
department that will assist organization to comply with the all the applicable rules and
regulations in long run (Haufler, 2016).
Recommendations
BHP Billiton Company should follow government policies and stakeholder’s oriented busienss
development. As per the report given by United States Securities and Exchange Commission
after Cambodia's Minister for Water Resources in its investigation, it was found that AUD $ 2.5
million of capital payment was made by company to government for the social and economic
development of society (Narula, Magray, and Desore, 2017). This capital was invested with a
view to help people who got hurt by its oil spills case in Brazil. In addition to this, the new
program and eco system adopted by BHP Billiton company has reflected that company has
complied with its all the applicable regulations and laws with a view to strengthen the corporate
social responsibilities. The CSR reporting frameworks and adopted business policies program
have reflected that company has set up strong public relation policy which strengthen the CSR
activities and social development plan of company (Bluszcz, and Kijewska, 2015).
Triple bottom line theory
Triple bottom line theory is used to strengthen the benefits to people, planet and planet.
BHP Billiton Company should follow these theories to mitigate the negative impact on the
society from tis business. The other issue have emerged due to the non-effective organizational
culture of organization which may negatively impact employee’s work functioning. It is
analyzed that company needs to comply with the employee’s code of conduct and set ethical
standards to promote the employees and motivate them to render best level of operational
services. It also must have followed the safe and secure health care work program for its
employees as well. The increased labour turnover in BHP Billiton Company will not only
increase the overall business costing of the organization but also lower down the return on

capital employed. It has reflected that company should maintain the effective CSR policies and
design its organizational culture to render best possible benefits to employees. It is the CSR
theory which allows company to align its interest with its main three objectives named, people,
planet and profit. BHP Billiton needs to strengthen its business activities with a view to increase
the overall output and efficiency of its busienss at large.
Business ethics theory
Business ethics theory is used to make the busienss more sustainable and operate the work
process more stakeholders oriented. The theory of organizational management and business
ethics addresses moral and values in managing an organization to manage its corporate social
responsibilities. As per this theory, company needs to align the interest of its stakeholders with
the organization’s development. All the CSR activities and eco-sport plans have been used by
BHP Billiton to strengthen the safety options available to stakeholders form the negative impact
of its business functioning. In the CSR reporting issues, it is observed that The CSR Disclosure
Company has included the essence of legitimacy theory which arises due to the increased
disaster of town of Bento Rodrigues, government authority allegation on the company. This case
was happened due to the increased regulatory compliance program and non-effective
environmental procedural work. However, Minas Gerais state environmental prosecutor declared
the incident as mistake of its board of directors which emerged due to its failure to meet legal
and ethical compliance (Haufler, 2016).
Evaluation of theories
These theories have suggested how organization after implementing these theories could
strengthen the overall outcomes and positive impact on stakeholders. This theory reflects that if
organization handled hazardous substance then it will have to strengthen its rules and regulation
for its reporting disclosure program The consideration of company for its other business factors
such as the key health, safety, environment, community and socio- economic risk of the business
are also reflecting that company strictly needs to follow the proper social and economic
development program to strengthen its business policies. It has used several methods to ensure
its legal and ethical compliance with its CSR policies and regulations which includes assessment
program related to its UN global work program and reporting initiative on international level.

Company has invested its capital in the community project plans and recording of the community
contribution which will be used for the UN spending projects and developing effective policies
program (White, 2017). These CSR issues have emerged as company has failed to invest its
capital in the CSR compliance program and there is no internal control system which company
could have used to mitigate the negative impact of its business on the society and environment at
large. It has been observed that BHP Billiton Company has to harmonize its international CSR
rules and regulations with its domestic regulatory compliance to strengthen its CSR program.
This will not only strengthen its business brand image on international level but also keep its
business sustainable. BHP Billiton needs to invest at least 5% of its average five year net profit
in its CSR activities to compensate the negative impact of its business on the society and
environment at large (Carter, 2015).
Critises of theory
The failure to achieve this triple bottom line approach, in the latest case of the Brazil dam failure,
it was found that many of the employees were having the confidential information regarding the
fact that the dam will fail. However, due to their personal profit they instead of sharing the
information with the stakeholder kept it confidential. This employee issue was emerged due to
non-availability of the platform for its employees to share the required information with its
employees and resulted to destruction of its process system (Mayes, McDonald, and Pini, 2014).
Therefore, aligning the interest of its organization with the society is very much required to
mitigate these sorts of issues. The business operations of company are required to identify and
manage health and wellbeing risks which will assist in meeting its targets on quarterly basis
(Gamu, and Dauvergne, 2018).
It should also manage its organizational culture to keep its employees motivated. BHP Billiton
Company’s scale of diversity is related to worst ravage of the cotemporary economic downtown
which negatively impacted the employees and other owners of the company. Therefore,
organization needs to set up proper development scale to manage the business effectively
(Haufler, 2016).