The Chief Executive Officer, (CEO) of the Petroleum Commission (PC) Egbert Fabille has revealed that Business Ethics and Compliance is a key component in making contract award decisions. He expressed concern about the fact that quite a number of indigenous companies have fallen short of meeting expectations in adhering to business ethics and compliance.
According to Lawyer Egbert Fabille available data on registered Indigenous Ghanaian Companies and feedbacks from tender evaluation and the award of contracts indicate that corporate governance and ethical issues are among key challenges facing IGCs in winning contracts.
He therefore called for the need to bring the issues to the fore and also identify ways of overcoming the challenge.
Mr Fabille made this known at a day’s workshop on Business Ethics and Compliance organised by the Petroleum Commission and Tullow oil Plc.
The virtual workshop provided participants the opportunity to learn and develop the habit of business ethics compliance to sustain and promote their businesses.
‘As business leaders, we need to be aware of some ethical issues. We need to appreciate, especially in the areas of bribery and corrupt practices that our laws and other international best practices may frown upon, composition members of board with people that are considered to be politically exposed, labour practices that conflicts with our laws and unethical financial practices amongst others. We believe that it is of utmost importance to avert the minds of companies in the sector to ethical issues in operating business and how to manage them to enhance good corporate governance. If companies are able to pursue good ethical behaviour, they build a sustainable brand which stands the test of time’, he stated.
‘While many of us may not be corporate governance specialists; we can equally relate to the impacts of good and bad governance. It’s this shared experience that has brought you all here today and that has influenced the content of this workshop. A cursory assessment of the impact of the Petroleum (Local Content and Local Participation) Regulations, 2013, (L.I. 2204) after its implementation for over six (6) years indicates that there remain significant barriers for Indigenous Ghanaian Companies participation in Ghana’s oil and gas industry’.
Only a fraction of spend by the IOCs and major service companies happen in-country and to Ghanaian companies. This situation is verry disappointing and unacceptable, given the fact that the resources that finance these spend are not only owned by Ghanaians but are also depletable.
To this end, the Board of the Commission in 2018 created the Business Advisory and Enterprise Development Department to among other things provide business advisory support and appropriate capacity development for indigenous Ghanaian companies to meet the requirements of the industry.
The Petroleum Commission has in the last couple of years, taken steps to enhance the capacity of Indigenous Ghanaian Companies (IGCs). Eighteen (18) workshops in nine (9) thematic areas were organised to address critical knowledge gap areas that adversely affect the realisation of the expectations of the Local Content and Local Participation Regulations. and address the problem of information asymmetry which limits the competitiveness of indigenous Ghanaian companies.
It is in this regard that the capacity building programmes for indigenous Ghanaian companies is being christened Ghana Upstream Petroleum Business Academy. On this note, it is my pleasure to announce to you that a series of modules covering various topics of interest to the industry have been lined as part of the Upstream Petroleum Academy programme in 2021. As you may be aware, the COVID-19 pandemic has impacted greatly on the upstream oil and gas sector and the economy. The Petroleum Commission although planned for a series of training programmes for the business year 2020, the Commission was unable to achieve the training objectives due to the pandemic. Although the COVID -19 is prevalent, we have also learnt to be adoptive to the new normal we find ourselves in. In this regard the Commission has decided to go virtual in organising these training programmes.
On his Part, the Managing Director of Tullow Oil,Wissam Al Monthirydescribed
Supplier development is an important component of Tullow’s local content strategy which has been an effective means by which Tullow has consistently increased indigenous participation in operations.
According to him, Supplier engagement sessions including but not limited to pre-tender, post-tender feedback, bespoke finance, insurance, joint venture formation and permitting training have resulted in better quality and more competitive bid submissions from local companies over the past 10 years. Consequently, we have seen a steady and significant increase in the value of contracts awarded to indigenous companies over the last decade.
‘Indeed, these development initiatives becomes even more important as the Ghana business focuses on delivering maximum value from the Jubilee and TEN fields under the Ghana Value Maximization Plan. When fully executed, the plan will see a further $4bn investment in Tullow’s Ghana operations over the next ten (10) years, which will lead to more activities and increase in production – That means more suppliers and more supply volume requirements’.
‘Collaboration and strategic partnerships between industry stakeholders to share knowledge and learn from each other is crucial for developing the capability and capacity of businesses in the upstream oil and gas industry. Our alignment with the national local content agenda and to tying-in TGL’s supplier training plans with the curriculum of the National Upstream Petroleum Business Academy provides an excellent platform for the Petroleum Commission and TGL to: Jointly address the development needs of Tullow’s suppliers and
- Extend the learnings from TGL’s supplier training sessions beyond our current suppliers to reach the wider local supplier community. Strengthen our relationship and improve communication with the PC and our suppliers’.
‘Tullow is proud to partner with the Petroleum Commission to deliver a series of practical industry-specific training in specialized subject areas that align with the curriculum of the National Upstream Petroleum Business Academy. Ethics and Compliance (which is the topic for today’s training session) is an evaluation criteria in the sourcing activities of companies operating in the upstream sector. It is a key component that results in a pass or fail scoring and easily limits the competitiveness of potential suppliers and service providers during tendering activities. Beyond satisfying the requirements for tendering, it is our hope that these sessions will equip you with the relevant knowledge, and help you incorporate global best practices in your business. That will not only make you highly competitive for Tullow bids, but a supplier of choice according to global standards in the oil and gas industry