UK: Oil Giant BP Stops Political Donations

LONDON -- BP PLC has announced it will no longer make political donations anywhere in the world, acknowledging that the relationship between corporations and government is under unprecedented scrutiny.

In a speech in London on Wednesday night, BP's chief executive, Sir John Browne, said the oil giant and other companies should keep their distance from the political process.

Browne said BP -- formerly British Petroleum -- ''will make no political contributions from corporate funds anywhere in the world.''

''We'll engage in the policy debate, stating our views and encouraging the development of ideas -- but we won't fund any political activity or any political party,'' he said.

A company spokeswoman said the policy, born out of ''a desire to be transparent and consistent,'' would take effect April 1.

The collapse of U.S. oil company Enron, and revelations of large donations to the country's politicians, has focused attention on links between politics and industry.

In Britain, Prime Minister Tony Blair has faced questions about his relationship with Lakshmi Mittal, a London-based steel magnate who donated $179,000 to the Labor Party last year.

Blair, who has vehemently denied any wrongdoing, subsequently endorsed Mittal's successful bid to take over Romania's steel industry.

Browne told an audience at Chatham House in London that companies were subject to ''intensified scrutiny'' from anti-globalization activists and a plethora of interest groups.

A BP spokesman said the company donated $850,000 last year to various ''federal and state specific political causes'' in the United States. The money was split roughly evenly between Republicans and Democrats, the company said.

BP did not make political donations in many parts of the world, said the spokesman, on customary condition of anonymity: ''The U.S. was the exception.''

In his speech to the Royal Institute of International Affairs, Browne said large multinational companies needed to exercise their power with care.

''We have to remember that however large our turnover might be, we still have no democratic legitimacy to determine how society will develop,'' he said.

BP has a worldwide work force of 100,000 in more than 100 countries.

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