The 2010 Gulf of Mexico Oil Spill; Evaluating Shareholder Value and Reputation

In this thesis we use the oil spill in the Gulf of Mexico in 2010 as a case study to evaluate how the short-term shareholder value and the reputation of BP have been impacted. By setting up a framework of the most significant events before, during and after the oil spill, we have identified the key determinants of these developments regarding BP in the light of our research. Especially during the two months since the inception of the oil spill in late April 2010 the share price of BP severely decreased, whilst negative attention by the media, public and politics has affected the reputational development of BP, which we have captured in biased though insightful ratings indices. BP dropped in the company rankings and received increased attention in the social reputation ratings, but credit ratings were only temporary lowered. We find a close direct relation between short-term shareholder value and reputational development. This adds more insight in the economic research of this oil spill and the relationship between shareholder value and stakeholder value development. Future research has to evaluate this relationship and the long-term impact of the oil spill. There is room for improvement in the field of social and financial company reputation ratings.