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Tangible losses have more readily quantifiable economic consequences. For
example, near- and long-term economic liabilities associated with potable water
contamination can adversely effect project economics. It becomes a question
of business ethics whether a practice that is legal but can lead to an adverse
environmental consequence should nonetheless be pursued because a cost-benefit
analysis showed that economic liabilities were less than economic benefits.
Typically, arguments to pursue an environmentally undesirable practice
based on cost-benefit analyses do not adequately account for intangible costs.
For example, the decision by Shell to dispose of the Brent Spar platform by
sinking it in the Atlantic Ocean led to public outrage in Europe in 1995.
Reversing the decision and disassembling the platform for use as a quay in
Norway resolved the resulting public relations problem, but the damage had been
done. The failure to anticipate the public reaction reinforced a lack of public
confidence in the oil and gas industry, and helped motivate government action
to regulate the decommissioning of offshore platforms in northwest Europe
[Offshore Staff, 1998].
The problem facing the industry is to learn how to achieve sustainable
development. One industry response to environmental and social concerns in
the context of sustainable development is the "triple bottom line" [Whittaker,
1999]. According to this view, sustainable development must integrate social
and environmental concerns into a development plan that optimizes economic
profitability and value creation. The three components of sustainable develop-
ment, and the three goals of the triple bottom line (TBL), are economic
prosperity, social equity, and environmental protection. The focus of TBL is the
creation of long-term shareholder value by recognizing that corporations are
dependent on licenses provided by society to do business. Whittaker [ 1999, pg.
25] reports that "After a period of serious introspection following the Brent Spar
debacle, Royal Dutch/Shell is perhaps the most enthusiastic supporter of TBL."
Although TBL is in its infancy, key elements of TBL policy are beginning to
emerge. They include [Whittaker, 1999, pg. 25]:
« Performance measurements that include qualitative social indicators and
ecoefficiency measures (such as energy consumption and recycling) in
addition to compliance and pollutant emissions.