May 24, 2019

DatePublished: 05-24-2019 08:34:55

DateModified: 05-03-2023 05:04:57

When the Deepwater Horizon oil spill occurred in the Gulf of Mexico in 2010, it was bad news for everyone—including the many oil and gas companies drilling there. The government suspended operations in the gulf until new safety practices could be established, and the lawsuits from (and between) energy companies began to fly. But Noble Energy followed a different strategy.

"Our team took the approach of partnering with the government regulators," says Noble Energy Executive Chairman and former CEO Chuck Davidson, "and we started working on a permit that would use new requirements, new standards, and new types of spill response systems with the government."

Noble Energy's focus on collaboration and partnership paid off. In 2011, the Interior Department approved the company's permit to be the first new deepwater drilling company allowed back to work in the Gulf of Mexico. While the company's primary goal had been to prioritize safety and positive relationships, the outcome certainly benefited the business. And Noble Energy's unique approach has led to success stories from Colorado to Israel. How did it happen? Great leadership.

During his tenure as CEO, Davidson worked with business consulting firm Gap International to draw out the best performance in himself and Noble Energy's employees. As Davidson nears his departure from the energy company after more than 14 years of exceptional leadership, he helps us examine what it takes to be a great CEO.

THE POWER OF PURPOSE

Everything a great CEO does, says Davidson, is grounded in purpose. Consultants at Gap International agree: according to the firm’s white paper on the 21st Century Organization "when leaders leverage purpose, it creates a competitive advantage that's difficult or even impossible to replicate."

Identifying Noble Energy's purpose was one of Davidson's first steps as CEO. He and his executive team looked beyond some of the obvious missions of an energy company, like building shareholder value and producing oil and natural gas efficiently.

"We finally landed on our real purpose," Davidson says, "which is 'energizing the world, bettering people's lives.'"

This new purpose reinvigorated employees. It connected them to how Noble Energy approaches business, not just what it does. And while internal excitement around this purpose was a terrific outcome, the larger benefit was how the mindset of "energizing the world, bettering people's lives" would drive the organization for years to come, Davidson explains.

A commitment to bettering people's lives drove the business to act differently after the oil spill in the Gulf of Mexico; it's what keeps it operating successfully in Israel, even though it can be a challenging regulatory environment.

The purpose also drove Noble Energy to work with the Environmental Defense Fund and state government in Colorado to develop new rules to regulate methane emissions as a part of oil and gas operations, Davidson says. Though that's typically the opposite approach taken by energy companies, it became a priority for Noble Energy because the company was committed to bettering people's lives.

"As we're making decisions about where we're going, we can always ask ourselves, 'Are we being loyal to our purpose?'" Davidson says. "If you get the purpose right, the rest falls into place."