- Looney resigned amid allegations of “personal relationships with colleagues.”
- He failed to fully disclose these relationships as required by the company.
- Murray Auchincloss, BP’s chief financial officer, has been appointed as interim CEO.
BP, the global oil giant, has faced a setback with the unexpected resignation of its CEO, Bernard Looney, amid allegations of “personal relationships with colleagues.”
This development has led to a decline in BP’s share prices. Looney, who had been at the helm for less than four years, reportedly failed to fully disclose these relationships as required by the company, which has led to a lack of transparency in his previous disclosures.
Bernard Looney, a 53-year-old executive who earned over £10 million in wages, bonuses, and benefits last year, is reported to have not provided full details of these relationships, as per the company’s requirements. BP issued a statement acknowledging Looney’s immediate resignation and his failure to be fully transparent in his previous disclosures. The statement reads, “He did not provide details of all relationships and accepts he was obligated to make more complete disclosure.”
The allegations concerning Looney’s conduct in personal relationships with colleagues first surfaced in May 2022. During this initial review, Looney disclosed a limited number of historical relationships with colleagues that predated his role as CEO, and no breach of the company’s code of conduct was found. However, the board sought and received assurances from Looney regarding the disclosure of past personal relationships and his future behavior.
Subsequently, additional allegations of a similar nature emerged, leading the company to launch an investigation with the assistance of external legal counsel. This investigation is ongoing. A BP spokesperson emphasized the company’s strong values and the expectation that all employees, especially leaders, adhere to these values and act as role models to earn the trust of others. Decisions regarding remuneration payments to Looney have not been made at this time.
Murray Auchincloss, BP’s chief financial officer, has been appointed as interim CEO following Looney’s departure. BP’s share prices experienced a 1.7% decline at the market opening in London on Wednesday morning, mirroring the reaction on US markets the previous evening. Share prices continued to drop during trading, closing down 2.7%.
Bernard Looney took on the role of CEO in February 2020 with a commitment to transform the 114-year-old company, including ambitious plans to achieve zero net emissions by 2050. He succeeded Bob Dudley, who guided BP through the aftermath of the Deepwater Horizon spill in 2010. Notably, Looney had spent his entire career at BP, joining as an engineer at the age of 21 in 1991.
Edward Moya, a senior market analyst at OANDA, commented that Looney’s resignation came as a surprise and could raise questions about BP’s transition to renewable energy. However, Moya suggested that BP’s share prices might not be significantly impacted, as CFO Auchincloss is poised to take over. The choice of a permanent CEO, when decided, will likely have a substantial impact on BP’s stock.
It’s worth noting that BP recently reported a significant drop in profits for the first half of the fiscal year, attributed to declining energy prices following Russia’s invasion of Ukraine. The company’s net profits for the three months ending in June were just over $2.5 billion (£2 billion), marking a substantial decrease from the preceding three months and a significant decline compared to the same period in the previous year.
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