Synthesis of the Report: Valero Energy Corp (Valero)

Valero – Module 8 Capstone Assignment
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Executive Summary
Valero is a leading energy exploration company in the US. The company has direct competition with Chevron. The findings suggest that Valero has a significant presence in the international market. The company operates with positive finances and excess cash flow. The daily productivity of Valero is 3.2 million barrels, maintaining the company’s strategic position in the long run. However, the consumer market experienced a paradigm shift. The market reports found that the energy industry has an excess supply influencing gas prices. Gas prices are reducing continuously, preventing companies like Valero from profit margin sustainability. The company is provided with strategic recommendations based on its SWOT analysis. Valero must increase its advertisement exercises to interact with different target audiences. The marketing campaigns would support Valero’s strategic intent to penetrate water and solar energy divisions. Besides, the company must promote its ESG portfolio using social or ethical marketing practices to create harmony with stakeholders. The ethical marketing strategy would allow Valero to build a strong relationship with the regulations to prevent penalties in the future.
Valero – Module 8 Capstone Assignment
Findings
Organization Background & Benchmarking
Valero Energy Corp (Valero) is a leading oil and gas (O&G) exploration company in the United States of America (USA). The module findings denote that Valero operates on a large scale. The company has more than 10,000 employees and 15 petroleum refineries. Since 1980, Valero has evolved into an independent energy exploration company worldwide. The company is a leading producer of renewable fuels in the North American region. Valero could process 3.2 million barrels of crude oil through daily operations, which is a competitive position for the company (Valero, 2022). The company operates responsibly under the industrial regulatory guidelines and expands operations worldwide through team diversity, corporate resources, business model strategies, strategic directions, and timely diversification of operations.
The research also explored that Valero has a weaker diversity than Chevron Corporation (Chevron), a direct competitor in the oil exploration industry. Chevron expanded its business operations beyond energy exploration to mitigate uncertainties in the business environment. Chevron is engaged in geothermal power generation, mining, and mineral exploration. The findings suggest that Chevron has 10,000 employees, equivalent to Valero. However, Chevron appropriately allocated its talents to expand business prospects (Chevron, 2022). Valero must understand the strategic sensitivity of talent utilization and business model diversification. The company must select Chevron as a benchmark to progress beyond O&G exploration. Valero should benchmark Chevron to penetrate opportunity avenues like mineral trading, thermal energy, and other unrelated diversification to secure performance sustainability in the long run.
The findings show that Valero has the potential to grow in the O&G sector worldwide. The company has an adequate talent pool and production capacity to surpass benchmarking of Chevron in the industry. However, Valero is underutilizing the resources due to minimal diversity and inefficient allocation. Valero requires a strategic direction and a system resource allocation plan to meet the performance standards of the global energy industry.
Organization Background, Ethics/Legal, and Current Events
Valero reflects a healthy ethical consideration for its stakeholders. The company has segregated its ethical considerations into three segments: environmental, social, and governance. The ecological standards prevent Valero from breaching ecology parameters through its operations. Valero ensures the manufacturing and distribution of low-carbon fuels. The company understands that greenhouse gas (GHG) emissions are a fundamental challenge for the energy industry. Stakeholders worldwide are sensitive towards the environmental benchmarks that O&G exploration companies breach by producing fossil fuels. Valero would use its environmental sustainability parameters to overcome the challenge. The company would engage in responsible energy manufacturing to avoid an ecological breach in the long run (Valero, 2022a). The findings suggest that product portfolio improvements based on environmental standards are a primary ethical consideration exhibited by Valero.
The findings indicate that Valero extends its environmental ethics beyond its product portfolio. The company is making necessary efforts to mitigate biodiversity impacts by exhibiting responsible actions towards society. Valero introduced different projects to restore biodiversity by reducing its carbon footprints and reducing interventions using natural resources. Valero would deploy environmental management systems (EMS) to increase energy efficiency and mitigate climatic risks to preserve biodiversity in the long run. Valero also integrates effective water management and recycling processes to improve operational efficiency based on environmental standards (Valero, 2022a). Hence, the ethical parameters of Valero are vital to protect ecological conditions for the stakeholders.
Social factors are the second ethical standards Valero follows strictly in its operational conduct. The findings denoted that Valero is sensitive towards employee safety and wellbeing. Valero provides healthy work conditions to employees as a fundamental requirement. The work conditions are psychological and physiological contributions made by the management to ensure talent prosperity. Valero considers that workplace conditions are essential for employees to exhibit individual ethics in a workplace environment (Valero, 2022a). Social ethics are necessary for Valero to nurture the company’s internal growth.
Valero emphasizes diversity and inclusion proactively. The company believes in knowledge-sharing culture and inclusion of minorities while accomplishing corporate missions. Valero keeps cultural, gender, and other ethnic parameters inclusive in the work culture to mitigate conflicts. The company owns communication transparent and drives each talent to excellence regardless of the cultural or gender association (Valero, 2022b). The findings denoted that diversity and inclusion are authentic pillars of corporate responsibility and ethical expression of Valero towards the stakeholders.
Valero strengthens social ethics from external parameters. The company makes necessary efforts to promote human rights and the prosperity of local communities by providing development opportunities. The company invests in regional economic development to expand its social presence in different communities (Valero, 2022a). The ethical standards embedded in the work culture allow Valero to earn real benefits for various stakeholders through social and economic prosperity.
Lastly, Valero has a diversified governance body responsible for integrating ethical conduct into its operational functions. The governance body ensures that employees express accountability towards social and environmental ethics through active participation. Valero exhibits lead people by setting ethical examples. The Board of Directors has 34% women representation. The company collaborates closely with independent communities to provide equal growth opportunities (Valero, 2022c). The governing body ensures ethical compliance by holding employees and board members accountable for diversity, participation, and equal opportunity distribution.
Marketing, Financials & Accounting
Marketing is a critical operational function for organizations like Valero. The findings in previous modules indicate that Valero has a market presence in different jurisdictions. Valero is recognized for its product innovation, ethics, and customer satisfaction. However, the marketing efforts could be more minimal for the company, which restricts optimal growth in the long run. The environmental paradigms and industrial trends suggest that Valero must perform social or ethical marketing practices to ensure sustainable development worldwide. Ethical marketing refers to transparent, open, and committed communication between companies and stakeholders. Ethical marketing encourages businesses to focus on core values and ensure fair business practices throughout a fiscal period. Ethical or social marketing focuses on different challenges experienced by stakeholders, which an organization could resolve through a responsible contribution (Hermann, 2022). Valero must understand the paradigm shifts in stakeholder communication to define its marketing strategy from social and ethical perspectives.
The findings suggest that Valero needs help with its marketing efforts. The company announced limited campaigns in past fiscal periods, which could disconnect the brand from the stakeholders during global competition. Valero must promote its ethical contributions towards people, the planet, and profit. The company must highlight its efforts toward biodiversity impacts and promote EMS, an internal system for measuring climatic effects and business processes. The approach would allow Valero to connect with internal and external stakeholders to create a brand reputation in the long run. Stakeholders, particularly government, regulatory bodies, and investors, would express positive associations with Valero in different markets. Valero could capture the interests of its target markets in other jurisdictions through an ethical marketing strategy.
Furthermore, the findings indicated that Valero has a robust ethical presence and social contributions. Valero could use social marketing to communicate its efforts toward diversity and inclusion. The company could use transparent communication channels to interact with target markets and express contributions made to minority groups of society. The practice would allow Valero to increase its talent base by incorporating people from different genders and ethnic backgrounds. Besides, customers would feel comfortable indulging in commercial exchanges with Valero in the long run. Ethical or social marketing efforts could allow Valero to strengthen its brand reputation and extend stakeholder networking in different jurisdi...