There’s yet another reason for Americans to hate outgoing BP CEO Tony Hayward. The Gulf Oil spill villain has flatly refused a request by U.S. senators to testify next month about his company's role in the release of the Libyan terrorist who bombed Pan Am Flight 103. Hayward didn’t even bother to invent an excuse – he just said BP has nothing to add to earlier statements.
It’s incredible that it took the Gulf oil spill for Congress to call BP on the carpet for the release of the man convicted of killing 270 people when Flight 103 blew up over Lockerbie, Scotland in 1988. BP admitted in late 2007 it told the British government that "We were concerned about the slow progress that was being made in concluding a prisoner transfer agreement with Libya. We were aware that this could have a negative impact on UK commercial interests, including the ratification by the Libyan Government of BP's exploration agreement."
I doubt we’ll ever find out the whole story of how BP influenced the UK and Scottish governments, based on my experience with AIG. I worked as the insurer’s global troubleshooter in the 70s and 80s and saw firsthand how a huge corporation can pressure foreign governments. But AIG, which had a reputation of being tough with foreign governments, was less tough when it came to the Chinese. CEO Hank Greenberg told me to get us invited to China after Nixon’s historic visit in 1972.
So we hired Chase, which was ahead of the game, to help us. It was a long, slow process and a careful one, influenced by our long history in China. (AIG got its start in Shanghai in 1919 and was quite successful until being expelled by Mao in 1949). We knew you could not push the Chinese too far like we did other governments. While we used a stick occasionally, we found the carrot far more effective.
For example, after I helped AIG reestablish operations in China, Greenberg couldn’t do enough to ingratiate himself with the country’s leaders. He even bought the original doors to Beijing’s Summer Palace from a Paris antique dealer so he could return them to the Chinese. Those efforts paid off when Greenberg personally negotiated the final details of China’s admission to the World Trade Organization with Chinese Premier Zhu Rhongi in 2001. It’s mindboggling that the U.S. government allowed a CEO to take the lead role in finalizing this critical trade pact.
AIG was always careful of Chinese sensitivities, but at times, we made mistakes. Once, when we were about to deliver a proposal, our lawyer told us the translator we had hired on the cheap used old Chinese, which named our company American International “Clique” Instead of “Group.” We found a good translator and eventually had the proposal accepted.
Nothing AIG did in China ever remotely approached BP’s efforts to use the British government to bolster its oil exploration deal with Libya. I’m glad the U.S. Senate is trying to get to the bottom of things, but BP’s stonewalling will make that very unlikely.