London (AFP) – Shares in British energy major BP dropped Wednesday after chief executive Bernard Looney resigned unexpectedly over his failure to disclose past relationships with colleagues.
BP CEO Bernard Looney is leaving after less than four years in the role
© Arun SANKAR / AFP/File
BP's stock fell nearly one percent to 518.20 pence at midday on London's falling FTSE 100 index, despite rising oil prices that normally boost energy firms.
The company announced late Tuesday that Looney, 53, resigned "with immediate effect" after admitting he had not been "fully transparent" about historical relationships with colleagues.
The Irishman is leaving after less than four years in the role, having steered the energy major through a tumultuous period that included huge swings in prices owing to the Covid pandemic and Russia's invasion of Ukraine.
"The higher oil price might limit some of the fallout from the shock resignation... but this is a highly unwelcome turn of events for investors given his long tenure at the company and his pivotal role at the helm as it navigates the tricky transition to greener energy," said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
"Change at the top is always unsettling and the abrupt nature of his departure will intensify reactions, particularly as it comes at such a sensitive time in the company's strategy," she said.
Looney took the top job in February 2020, shortly before the 10th anniversary of the explosion on the BP-leased Deepwater Horizon rig in the Gulf of Mexico that triggered the worst oil spill in US history.
The disaster killed 11 employees and cost the British firm tens of billions of dollars in damages and compensation.
Looney's arrival came also shortly before oil prices briefly turned negative as Covid lockdowns slashed energy demand and slammed the sector.
Finance chief Murray Auchincloss will now act as interim CEO while the group seeks a permanent successor.
BP's stock fell nearly one percent to 518.20 pence at midday on London's falling FTSE 100 index, despite rising oil prices that normally boost energy firms.
The company announced late Tuesday that Looney, 53, resigned "with immediate effect" after admitting he had not been "fully transparent" about historical relationships with colleagues.
The Irishman is leaving after less than four years in the role, having steered the energy major through a tumultuous period that included huge swings in prices owing to the Covid pandemic and Russia's invasion of Ukraine.
"The higher oil price might limit some of the fallout from the shock resignation... but this is a highly unwelcome turn of events for investors given his long tenure at the company and his pivotal role at the helm as it navigates the tricky transition to greener energy," said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
"Change at the top is always unsettling and the abrupt nature of his departure will intensify reactions, particularly as it comes at such a sensitive time in the company's strategy," she said.
Looney took the top job in February 2020, shortly before the 10th anniversary of the explosion on the BP-leased Deepwater Horizon rig in the Gulf of Mexico that triggered the worst oil spill in US history.
The disaster killed 11 employees and cost the British firm tens of billions of dollars in damages and compensation.
Looney's arrival came also shortly before oil prices briefly turned negative as Covid lockdowns slashed energy demand and slammed the sector.
Finance chief Murray Auchincloss will now act as interim CEO while the group seeks a permanent successor.
Other CEOs, too
"Compared to the multi-billion-dollar fines following the Deepwater Horizon spill, briefly negative oil futures prices and dividend cuts during the pandemic, the resignation is a surprise but perhaps not a major chapter in BP history," said Interactive Investor analyst Richard Hunter.
"With a temporary replacement now confirmed, BP will be hoping for markets to regard the situation as business as usual," he said.
"There will, however, inevitably be uncertainty until such time as a permanent replacement is found and the company clarifies whether there will be any changes to its current strategy."
Looney had also come under fierce criticism from environmentalists, who have accused BP and rivals of not going far enough in transitioning away from fossil fuels.
He is not the first head of a major global company to resign or be ousted over relationships with employees.
Steve Easterbook was ousted as CEO of McDonald's in 2019 for having a "consensual relationship" with an employee, in violation of company policy.
A year earlier, Brian Krzanich stepped down as chief executive of US computer chip giant Intel over a "past consensual relationship" with an employee in violation with the company's non-fraternization policy.
13/09/2023
© 2023 AFP
BP chief Bernard Looney resigns ‘with immediate effect’
By AFP
September 12, 2023
Oil giaqnt BP is offloading its 19.75 percent share in Russian-owned Rozneft.
By AFP
September 12, 2023
Oil giaqnt BP is offloading its 19.75 percent share in Russian-owned Rozneft.
Credit - Weixi Zeng, (CC BY-SA 3.0)
British energy giant BP said Tuesday that its chief executive Bernard Looney has resigned “with immediate effect”, after admitting that he had not been “fully transparent” about historical relationships with colleagues.
“Bernard Looney has notified the company that he has resigned as chief executive officer with immediate effect,” the company said in a statement, adding that finance chief Murray Auchincloss would act as interim CEO.
Looney, 53, is leaving the energy firm after less than four years in the role.
BP said that in May last year its board received and reviewed allegations from an anonymous source relating to Looney’s conduct “in respect of personal relationships with company colleagues”.
Looney disclosed “a small number of historical relationships with colleagues prior to becoming CEO” during the review, it added, while noting that no breach of the company’s code of conduct was found.
However, the board was given his assurances over his disclosures of past personal relationships, as well as his future behaviour, according to BP.
“Further allegations of a similar nature were received recently, and the company immediately began investigating with the support of external legal counsel,” it said, adding that the process was continuing.
Bernard Looney ‘accepts that he was not fully transparent’ – Copyright AFP/File Rodrigo BUENDIA
“Mr Looney has today informed the company that he now accepts that he was not fully transparent in his previous disclosures,” BP added.
“He did not provide details of all relationships and accepts he was obligated to make more complete disclosure.”
BP said the board expects all staff to behave in accordance with the company’s values.
“All leaders in particular are expected to act as role models and to exercise good judgement in a way that earns the trust of others,” the company said.
Looney has been at BP since joining the British energy behemoth in 1991, and was appointed chief executive in 2020.
The company said no decisions had yet been made regarding any remuneration payments.
Looney had vowed to reposition BP as a leader in clean energy technologies, and gradually cut oil and gas production to reduce carbon emissions, but environmentalists have criticised the firm for inaction in that regard during his tenure.
Like many of its rivals, BP earlier this year unveiled record annual profits for 2022, thanks to soaring oil and gas prices following Russia’s invasion of Ukraine.
However, earnings have fallen somewhat from those heights so far this year, as energy prices retreated for much of 2023.
Nonetheless BP said in August it was hiking its dividend and returning $1.5 billion to shareholders by repurchasing stock.
British energy giant BP said Tuesday that its chief executive Bernard Looney has resigned “with immediate effect”, after admitting that he had not been “fully transparent” about historical relationships with colleagues.
“Bernard Looney has notified the company that he has resigned as chief executive officer with immediate effect,” the company said in a statement, adding that finance chief Murray Auchincloss would act as interim CEO.
Looney, 53, is leaving the energy firm after less than four years in the role.
BP said that in May last year its board received and reviewed allegations from an anonymous source relating to Looney’s conduct “in respect of personal relationships with company colleagues”.
Looney disclosed “a small number of historical relationships with colleagues prior to becoming CEO” during the review, it added, while noting that no breach of the company’s code of conduct was found.
However, the board was given his assurances over his disclosures of past personal relationships, as well as his future behaviour, according to BP.
“Further allegations of a similar nature were received recently, and the company immediately began investigating with the support of external legal counsel,” it said, adding that the process was continuing.
Bernard Looney ‘accepts that he was not fully transparent’ – Copyright AFP/File Rodrigo BUENDIA
“Mr Looney has today informed the company that he now accepts that he was not fully transparent in his previous disclosures,” BP added.
“He did not provide details of all relationships and accepts he was obligated to make more complete disclosure.”
BP said the board expects all staff to behave in accordance with the company’s values.
“All leaders in particular are expected to act as role models and to exercise good judgement in a way that earns the trust of others,” the company said.
Looney has been at BP since joining the British energy behemoth in 1991, and was appointed chief executive in 2020.
The company said no decisions had yet been made regarding any remuneration payments.
Looney had vowed to reposition BP as a leader in clean energy technologies, and gradually cut oil and gas production to reduce carbon emissions, but environmentalists have criticised the firm for inaction in that regard during his tenure.
Like many of its rivals, BP earlier this year unveiled record annual profits for 2022, thanks to soaring oil and gas prices following Russia’s invasion of Ukraine.
However, earnings have fallen somewhat from those heights so far this year, as energy prices retreated for much of 2023.
Nonetheless BP said in August it was hiking its dividend and returning $1.5 billion to shareholders by repurchasing stock.
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