ABSTRACT
Contemporary management within the oil and gas industry uses performance management to monitor and evaluate employees’ and responsibility centres’ financial and non-financial performance within the upstream and downstream organisations. However, existing literature has largely overlooked the development of a comprehensive performance management framework in the oil and gas industry. This chapter discusses performance management in the oil and gas industry. It presents various theories and practices underpinning performance management systems and advances the balanced score card as the industry's most widely used performance management tool. It further highlights two primary performance improvement processes – lean accounting and benchmarking – highlighting how these processes help oil and gas companies to attain operational excellence. The chapter explains how lean accounting ensures improved performance through meeting customer needs, reducing inventories, and ensuring employee satisfaction. Benchmarking in the oil and gas industry involves learning from others regarding environmental management, environmental impact, and disclosure and transparency to improve the businesses of the oil and gas sector. It is, thus, essential for the oil and gas industry in emerging and developing countries to use environmental management, environmental impact, and disclosure and transparency for the environmental rating of oil and gas companies, to offer the UN a more effective way of benchmarking the sustainable development goal's achievement.
