Because
exploration ventures historically have been associated with high
risk and great uncertainty, they have been perceived as speculative
by many prudent investors — thus the natural arena for two general
types of private investors: ill-informed victims and well-informed
survivors. Caveat emptor is the watchword.
That's
why portfolio management is so important, and so widely utilized
by successful E&P companies — it allows such risks to be diversified.
And E&P
risk analysis, on which it depends, requires prospectors to be objective
and professional.
It is no
accident that petroleum exploration has been the natural habitat
of visionaries, seers, promoters and not a few outright frauds —
as well as a far larger number of commendably honest and honorable
geoscientists, engineers and landmen. With so much money riding
on the outcome of so many high-risk, high-potential ventures, such
intense competition among various players, and such wide usage of
geotechnical tools (and their consequential output), it is only
natural that secrecy and proprietary data are endemic to the E&P
business.
Some of
the most common ethical lapses among explorationists involve confidentiality
and respect for proprietary tools and information. Many geoscientists
seem to have conflicting ideas about data:
- The scientist in
them prefers to view all information as public property — but
with an inalienable right to personally "rat-hole" it!
- The business person
jealously guards it as private property.
However,
the law on proprietary information and intellectual property comes
down mostly on the side of whoever paid for it. So it's disappointing
— but not surprising — that many proprietary seismic lines and
maps have strayed away from their proper stewards.
And how
many geoprofessionals have unlicensed copies of proprietary software
on their computers?
How many
corporations communicate clear codes of conduct to their professional
employees about proprietary data and tools, and periodically check
on their compliance?
The flip
side of the confidentiality coin is communication — objective,
transparent and timely communication to our managers, directors
and investors.
It's easy
to relay good news. Conveying bad news is a lot tougher, requiring
disciplined professionalism and often the willingness to be accountable.
As we all know, "Success has many fathers; failure is an orphan."
Bottom
line: Always tell the truth (you'll never have to remember what
you said), and tell it timely.
A serious
breach of ethics may not result in a complaint being filed with
AAPG's Ethics Committee. Historically, it is even more unlikely
that AAPG will take any official adverse action (though I hope that
will change soon). But such a breach will likely cost you a colleague's
respect, a client's confidence or a competitor's condemnation.
Based on
my 43 years of experience, several such breaches are likely to make
you, unknowingly, a pariah among your peers. Always remember that
the E&P business is an amazingly small community — and the
word really does get around. Folks have long memories.
Never forget
that real people get hurt because of ethical violations — professionals,
investors, families and friends. People are cheated out of their
property. Their good-faith investments are wasted. Their hard work
is denigrated. Their faith is destroyed. On the other hand, careers
can be capsized, and families can be shipwrecked.
Ethics
is not some ivory-tower abstraction.
With all
this uncertainty, thirst for data and complex conditionality of
deals, how does the well-intentioned explorationist keep to the
straight and narrow and still remain competitive?
Most important,
always conduct yourself as a professional!
Over the
course of a career, it behooves you to frequently "take stock" regarding
your interactions with colleagues, clients and competitors. And
constantly think about what you are doing in your business dealings.
Also, it's not a bad idea to have a framed copy of AAPG's Code of
Ethics on the wall of your office, in plain view of your clients
as well as yourself.
But it
also would be good if AAPG, through its Division of Professional
Affairs, would be much more aggressive about pursuing ethical violations.
Because
ethical lapses come in varying degrees of severity, I think we should
handle many ethical problems internally, through mediation, mentoring
and warnings. Beyond that, sanction and expulsion should be more
frequent, even if it does risk counter-litigation.
Finally,
members might expect our professional associations to maintain a
higher profile regarding ethical events:
- Did AAPG, or AIPG
or SIPES speak up promptly and prominently to condemn the Brea-X
mining fraud a few years ago?
- Our silence regarding
the recent Enron scandal has been deafening.
Why haven't
our professional associations spoken out through timely press releases
to the media and articles in our own journals? Isn't that part of
their proper purview? Or is the AAPG just a trade association?
This month's
reading recommendation: Systems of Survival, by Jane Jacobs (1992
Vintage Books), a remarkably insightful little book about differing
ethical systems and standards.
Read it
— you'll like it!