Shareholders of BP have expressed their dissatisfaction with the sudden departure of CEO, Bernard Looney. Looney resigned after it was revealed that he had not properly disclosed his past relationships with colleagues to the board before taking on the role. This recent development has once again brought BP's poor shareholder returns into focus, as shown in the chart below:
Compared to other integrated oil majors like Exxon Mobil and TotalEnergies, BP's returns have been disappointingly low. Looney took over as CEO in February 2020 and during his tenure, he veered away from BP's initial plans to reduce its reliance on fossil fuels.
Analysts at Alphavalue have raised concerns about BP's governance, particularly the handling of these abrupt resignations. Looney is the third CEO of BP to step down suddenly. This recurring pattern has led to questions about the effectiveness of BP's disciplined and measured approach to governance. In the world of Big Oil companies, C-suite matters and succession plans are typically meticulously prepared over long periods, leaving little room for sudden departures dictated by market conditions or fate.
While an interim CEO, Murray Auchincloss, has taken the reins at BP for now, Alphavalue suggests that internal candidates like upstream e.v.p. Gordon Birrell and the head of the trading arm, Carol Howle, could be potential successors. Finding a capable leader to restore stability and ensure a smoother transition is crucial for BP's future success.
In conclusion, BP finds itself at a crossroads as shareholders express their concerns over the CEO resignation and the company's governance. The spotlight is now on BP's ability to provide effective leadership and chart a clear path forward in an ever-changing energy landscape.
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