Corporate Governance and Reputation: Kinder Morgan Report Analysis

This report provides a comprehensive analysis of Kinder Morgan, a major energy infrastructure company specializing in oil and gas pipelines and terminals. It examines the company's corporate governance structure, including its board of directors, financial reporting, and shareholder rights. The report also delves into Kinder Morgan's reputation management strategies, such as social media monitoring and employee assistance programs, and explores real-world examples of its impact. Furthermore, it assesses the company's corporate social responsibility initiatives, including its gross globe scope and emission program, and climate policy program, highlighting both proactive and reactive measures. The report concludes with a discussion of boardroom organization, ethical considerations, and behavioral challenges within the company.

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Kinder morgan
Politics in oil and gas management
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Executive Summary
Kinder Morgan Company is one of the energy infrastructure company that have specialization in
the controlling the oil and gas pipelines and terminals. The aim of business is to evaluate the
corporate governance, Reputation Management, corporate social responsibility and boardroom
politics. The key findings of this report as company have 72,000 miles and 38 percent Natural
gas used in the United States. Company’s headquarters is located in Houston, Texas. The
forecasting projections of Kinder Morgan have 22.00 targets in next 12 months. By 2020, Kinder
Morgan produce as much oil and natural gas on a daily basis in United States and imports from
Venezuela, Algeria and Colombia.

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Contents
Introduction................................................................................................................................3
Kinder Morgan...........................................................................................................................3
Corporate governance................................................................................................................3
Governance Structure..................................................................................................................4
Reputation Management............................................................................................................5
Real Example:..............................................................................................................................5
Themes.........................................................................................................................................6
Corporate social responsibility..................................................................................................6
Gross globe scope and emission program:..................................................................................7
Climate policy program:..............................................................................................................7
Proactive and reactive measures..................................................................................................8
Boardroom organization and management................................................................................9
Board room politics.....................................................................................................................9
Ethical matters...........................................................................................................................10
Behavioral challenges................................................................................................................10
Conclusion...............................................................................................................................11
Bibliography............................................................................................................................12

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Introduction
In this report, there is a brief discussion about the corporate governance, corporate social
responsibility and board management politics in Kinder Morgan Corporation. The purpose of
this report is to evaluate the government structure of the company and other ethical matters in the
management. Corporate governance of Kinder Morgan includes internal processes, the demand
of stakeholders and government regulations. Under the discussion of the reputation, management
of Kinder Morgan influence and controlling of employees is stated. At the end of the report,
board organization and management are discussed. About Kinder Morgan
Kinder Morgan
Kinder Morgan is the biggest energy infrastructure company in North America. The
specialization of the company is controlling oil and gas pipelines and terminals. The company
holds operates under the 85000 miles of pipelines and 152 terminals. Company’s major
operational working is to transports the natural gas, carbon dioxide and refined petroleum
products in which 38% natural gas is consumed by the United States (Kinder Morgan inc., 2019).
This company is the largest transporter of petroleum products in North America. Kinder Morgan
has the largest oil and recovery projects. Company’s headquarters is located in Houston, Texas.
Corporate governance
The composition of the board of directors is part of the corporate governance which states that
there byelaws in which board of directors will be fixed by passing a general or special resolution
in the board meeting. Every director shall be a person of honesty and integrity. Third-fourth of
the directors must be independent and described under the “Director Independence”. According
to the Corporate Governance Guidelines for the BOD (Board of director), the committee has the
sole authority to retain and compensate the external independent consultants. Company has
three-segment, upstream, midstream and downstream. The exploration and production come
under the upstream segment, transportation and storage products come under the midstream

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segment, refining and marketing of crude oil come under the downstream segment (Amran,
2014).
These segments balanced by the company in the nation and commercial interest. The
organization structure of the Kinder Morgan management states that it is a limited liability
partnership and established in 2001. The company holds all the outstanding common equity in
the KMP voting shares. Power and authority of KMP Morgan are in the hands of KMP Morgan
G.P. Kinder Morgan has some rights to approve transactions from the principal company. KMP
owns some I-units from limited partners. The securities hold some right and obligations in the
Kinder Morgan. The shares of the company are listed on the New York Exchange. The “Un-
controlling interests” in the financial statements of the company treated as equity interest and
stated as non-controlling interests in the consolidated statements of income. Corporate
governance influence the decision making the power of the BOD (Board of Directors) as it
makes policies in the interest of the nation and society level ( Beiting, 2014).
Governance Structure
Governance structures of Kinder Morgan have different categories such as disclosure of financial
information, dividend payments, corporate violation of the shareholder’s rights and management
and supervisory board structure. The financial structure mainly verified by the independent
auditor. The company maintains its financial reports according to the GAAP (General Accepted
Accounting Principals) and international accounting standard. The statement of comprehensive
income of Kinder Morgan incorporation mainly includes non-owners sources. It includes all
variations in equity during a period except those resulting from investments by owners and
distribution to owners (Dutta, 2017).
The dividend payment in relation to the corporate governance states that company is paying a
dividend every financial year such as in 2017 company declared the dividend of $0.125 and in
2018, it declares the dividend of $0.2 or in 2019 it declares $0.25 including regular cash (Amran,
2014). The corporate violation of the shareholder’s rights in Kinder Morgan Company can be
seen in 2018, the new pipeline mountain project of the company offers the billions to the
Trudeau government but in the early negotiations, the government rejected the offer. The
company did not discuss with the major shareholder about the negotiation process, which dilutes

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the right of the shareholder ( Hoje, 2011). The management and supervisory board structure of
Kinder Morgan state that management team purchased the reins of KN Energy (Natural gas
Company) to provide the services in the small communities and rural areas. Company has CO2
production fields and transportation pipelines and increases the growth through the new build
projects. The company management structure has efficient strategies by acquiring a small natural
gas company (Gotsi, 2011).
Reputation Management
Reputation management is also known as the online management system by an organization to
shape the public perception of the organization. The reputation management first step is social-
media monitoring in which a company promotes the positive work environment to the employees
in a safe and productive manner (Harjoto, 2011). The company ensures the harmful effects of
any alcohol, risk in the exploration of natural gases and provide safety measures to the workers.
The company runs an online Employee Assistance Program where the workers and employee
can report about the drugs or hazardous process that affect their health. A real example happened
in company one of the employee of the company is suffering from the disease and doctor-
prescribed drugs to the employee, which cautioned against while working on the machinery in
the company so employee filed its query on the Employee Assistance program and gets the
assistance from the management (Gotsi, 2011). Sponsoring posts on social media is common to
boost the company’s image in the market and message through advertisement regarding the
company’s policies and procedures is comes under the reputation management. A real example is
stated below:
Real Example: The oil patch group posted an online poll on facebook that changed the level
of support of the company’s mountain expansion. Group did not mention the reason for the
online post and Facebook did not the flag the activity of the group. The reason for an online poll
by the group, in Texas a huge pipeline creates a clash between the neighbor provinces and
British Columbia because of the gas prices soaring. The posts were through the Facebook page
that disturbs the company project of exploration (Longo , 2018). The company maintains its

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reputation in internal reputation management through Employee Assistance Management and
maintains the external reputation through social media platforms ( Hoje, 2011).
Themes
The themes used in corporate governance, corporate social responsibility reputation management
are enhancing the quality of life-providing products required by society, developing people and
growing with society. Company work in the interest of national and society level in corporate
governance (Kinder Morgan, 2019). The company evaluates the CSR issues in the operating
management and themes that significant for the stakeholders and business. Kinder Morgan set a
defined goal on the society level, not on the organization level with the only motive of the profit.
The company identified the mining and exploration equipment has and applies the CSR themes.
Effectively implementation of the CSR themes the issues must be identified by reviewing the
external reports, public statements, and government reports. The themes related to corporate
governance include the media, supplier, and customers. The themes of CSR and corporate
governance are both significant for the business and shareholders. Company before applying the
themes focuses on the material issues that influence the business in a negative way. The CSR
themes include the environment, employees and human rights. The company must ensure the
responsible management with the sustainable environment that includes safety measures during
the working, remanufacturing and environmental efficiency. The themes also include employees,
managers, and their rights in the management and give equal opportunity to share the missions
and views on the safety measures of the company. (Kinder Morgan, 2019).
Corporate social responsibility
Kinder Morgan fulfills its compliance activities for the protection and safe operations of the
pipelines. Pipelines facilities of the company ensure with the rules and regulations. The
sustainability logo of the company is “People First, Safety Always” which states that employee,
contractor, public safety is a priority for the company and company for the public safety
organizes a safety program. Reputation management analysis of company states that for the
safety record company uploads its safety statistics online for the public reviews. During the
company’s allocations and performance reviews engagement of the business units and employee

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is ensured by the company (Kinder Morgan, 2016). Kinder Morgan fulfills its corporate social
responsibility by implementing the safety programs with the help of the emergency responders,
contractors and governed agencies of oil and gas management. According to the annual report of
2016, company safety measure is they have a platinum-level supporter of the Common Ground
Alliance (CGA) (Rufin, 2012). To monitor the excavation Safety Company provides certification
and performance monitoring program and became the founder member of the Gold Shovel
Standard. The public awareness program of the company runs on the website of the company in
which regular guidelines of pipelines safety is updated on a regular basis (Tomlinson , 2015).
Figure 1 Kinder Morgan CSR ranking
Source: (Kinder Morgan, 2019)
The two examples of CSR initiatives of Kinder Morgan are:
Gross globe scope and emission program: Kinder Morgan initiated this program to
fulfill the Corporate Social responsibility in which company hired a team for the additional
processes and procedures and information technology systems in which new safety measures are
evaluated by the team. The hired team evaluates safety measures based on new technology.
Significant observations and recommendations related to oil and handled by the program to run
the gas management. This program evaluates GHG emissions through electricity consumption
(Kumar, 2012).

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Climate policy program: Company has a natural incentive to explore the methane emissions
and involved in the crude oil recovery. Company initiates this program to reduce the methane
and CO2 emission in its local operations (Kinder Morgan inc., 2019). Climate change is the issue
of global and economic level. In this program, the company is worked with many environmental
groups to improve the condition of climate. The main objective of this program is making the
operations of safety more efficient and reducing the byproduct waste of company. Climate
change program protects the rights of consumer and stakeholders in the regular operations
(Longo , 2018).
Proactive and reactive measures
The proactive measures adopted by the Kinder Morgan are sequential, Epidemiological and
systematic proactive measure. The sequential model alerts the company about the upcoming
accidents, malfunctions, and failures of different technology in the company. The
epidemiological model suggests ways to reduce the harms from the accident. The systematic
models evaluate the dependencies of management on the resources and help to use in an efficient
manner. The proactive measures help in the assessment of the environment, give safety system to
identify the hazards, best practices to manage the resources, emergency response framework,
emergency response framework, and environmental system. Proactive measures in the
management of Kinder Morgan give safety to the operations of the company and provide safety
against the reactive measures. The offshore oil spill incidents can be reduced by proactive
measures ( Reinhard, 2011).
The company to boost-up the programs and increase the growth by 25% in the US and 21% in
Canada uses reactive measures. Kinder Morgan faces an economic downturn in the last few
years such as low-priced oil or downstream equipment contractors (Tilak, 2018). The Texas
pipeline burst incident forced the company to use the reactive measures that help in the quick
repairs and push equipment. The company taking programs that are more reactive to maintain the
reputation of the company and advantage in the cost-saving. The upstream of pipeline in the
management is cyclic in nature that cause loses highly skilled and experienced labor and reactive
maintenance programs provides effective ways to deal with the accidents and new professional
workforce for the local operations (Rufin, 2012).

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Boardroom organization and management
Boardroom management refers to the tool from which allows the interaction between the
directors and other management of the company. Broad room is also a software adopted by the
management to establish a manager-employee relationship. The broad room helps to keep
activities organization in a stable workflow. To maintain the boardroom management the
management checks the composition of the board of directors in a rotational manner. The board
of directors must be a person of integrity, honest and fair. Every director must be knowledgeable
about the company’s operations. Nomination and governance committee of the company ensures
that third-fourth of the directors is independent and comes under the Director independence.
Boardroom management also includes the functions of the Board of directors, which means
selecting, evaluating and compensating the Board of directors (Schooty, 2011)
In the Kinder Morgan organization structure and way of working is different so to implement the
boardroom management company implements the Digital transformation strategies that help to
maintain a relationship with the employees because it is an easy way of communication in the
management that helps the company to achieve the goals and objectives with the help of
strategies. Boardroom management helps to remind the board of directors to conduct the
meetings to know the employee vision and mission. If the meeting is held in an offline manner
than the output results is uploaded on the digital portal. Regular Interaction management of
employee with the board of directors is important because it helps to achieve the goals and
receiving recommendations on safety measures (Yang, 2014).
Board room politics
Boardroom politics in the organization refers that directors must understand that board hold
supervisory responsibility of the management and ensure the pattern of corporate governance in
the company. The board of directors to improve the effective relationship with the company must
adopt an effective choice. BOD in the meetings confronts the ideas of the employees to enhance
the safety measures in the management (Wilson, 2012). Corporate governance comes under the
authority of the board of directors that effectively supervised by the directors. In the board
meetings, the directors must evaluate the trends related to the safety measures and updated on the
digital portal of the company so that other employees can review the policy and procedures. The

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board politics includes the workbooks, visual presentation, and training to the employee
regarding the workplace hazards. Kinder Morgan has serious hazards because the company is
involved in the oil and gas management process, which is harmful to the employees (Wæraas,
2012).
Ethical matters
The ethical governance in the oil and gas industry is significant for both the business and the
environment. Kinder Morgan has an environmental, health and safety committee that managed
by the board of directors. Management implements the policies and programs to promote the
safety and health of employees. The management periodically reviews the safety and health
practices of the company. The business regularly evaluates values and missions in the
management regarding the citizens of the global world (Holberg, 2017). Decision making in the
management also comes under the ethics in oil and gas management. Decision making of Kinder
Morgan affects society and employees on a regular basis. One of the major factors of the ethical
matters is due diligence which should be fulfilled by the company including the ownership
structure and compliance procedures of the company. The company must follow the guidelines
provided by the government to the oil and gas companies. The safety measures of employees
under the ethics procedures of the company (Tomlinson , 2015).
Behavioral challenges
Kinder Morgan is facing many challenges but the main challenge has changed the behavior of
the employees in the organization. Kinder Morgan faces a new approach in the offshore field
development and faces dissatisfaction from the employees. The main reason for the changed
behavior is changed in the technology of oil and gas industry such as a change in the drilling
program and exploration in the natural gas of the company. To mitigate the risk from the
changed behavior company launched the employee assistance program, to reduce the risks from
the changed behavior (Rufin, 2012).

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Conclusion
Kinder Morgan corporate governance in management promotes the strong financial systems and
reflecting a growth of the company. After the accident of Pipeline burst in Texas Company still
manages to gain the trust shareholders and employees. Kinder Morgan’s corporate social
responsibility results in a reduction in harmful waste and managing the employees in moral
ethics. Uncertainty is a part of the company because of complex forces that never conveniently
measurable. It is concluded that the company should follow the industry standards of health and
safety of the workforce.