Leadership Shake-Up at BP
BP has removed Chair Albert Manifold from his position with immediate effect, citing governance standards, oversight, and conduct issues. This change occurs less than eight months after Manifold took over the role to oversee a strategic transformation of the company. The decision follows previous leadership turmoil at BP, including scandals and sudden changes in key positions.
Background of Recent Leadership Changes
BP’s leadership has been unstable in recent years. The dismissal of former CEO Bernard Looney occurred after misleading the board about personal relationships with colleagues. Following Looney, his successor Murray Auchincloss left unexpectedly in December without any clear explanation. Meg O’Neill, previously CEO of Woodside, was appointed as BP’s fifth CEO since 2020 to redirect the company’s strategic focus towards traditional oil and gas, moving away from renewable energy initiatives announced by Auchincloss the previous year.
Albert Manifold was ousted as chairman of BP after less than eight months in the role.
BP announced Manifold’s departure in a statement that highlighted unanimous board concerns regarding governance and conduct issues. Despite Manifold being backed by activist hedge fund Elliott, which holds about 5% of BP’s shares, the board concluded that Manifold should no longer serve as chair.
Board’s Response and Market Impact
According to Amanda Blanc, senior independent director overseeing Manifold’s appointment, while Manifold contributed positively to BP’s transformation efforts, the governance issues identified were deemed unacceptable by the board. BP shares fell nearly 10% following the announcement, although they later recovered slightly to a 5% decrease. European energy indices also experienced a slight dip in response to the news.
Manifold’s Background and Challenges
Coming from a non-energy background, Manifold had previously gained recognition as the chief of CRH, a building materials producer, where he achieved notable success in reshaping the company’s portfolio and transitioning its primary listing from Ireland to the U.S. BP appointed him amidst issues of underperformance compared to its competitors, leading to speculation of potential takeovers.
Under Manifold’s leadership, BP’s board size reduced, and Shell finance chief Simon Henry left shortly after joining in September. At BP’s annual general meeting in April, the board faced challenges when two resolutions were not accepted by shareholders, and Manifold’s appointment received less support than typically expected. Proxy adviser Glass Lewis criticized Manifold for excluding resolutions from climate activist group Follow This and recommended a vote against him. The confirmation of his appointment received roughly 82% of votes, which is less than the usual support of around 100% for directors.
Ian Tyler, formerly chief of British construction group Balfour Beatty and a BP board member since last year, will serve as interim chair until a permanent successor is appointed.