BP CEO Bernard Looney has resigned with immediate effect after admitting he failed to disclose relationships with staff.
The CEO job is to be filled by CFO Murray Auchincloss on an interim basis until a long-term replacement is found. 53 year-old Bernard Looney has been leading BP for less than four years after starting as an engineer at the oil major in 1991.
Despite Looney’s long tenure, he was shown no quarter for risking bringing the British institution into disrepute.
“BP is one of the biggest players in British business, missteps of this magnitude aren’t what investors expect from one of the country’s most influential C-suites. Strong governance and conduct controls are rightly non-negotiables, and the emergence of a second round of allegations relating to Looney’s improper disclosure of relationships has proved a bridge too far,” said Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown.
“BP is now in a position where a permanent replacement needs to be found. A clear path forward needs to be forged sooner rather than later to limit negative sentiment. This of course all lands at a time when oil majors are already grappling to boost their ESG credentials, which adds weight to the problem. Looney has spearheaded an aggressive and green-thinking strategy during his tenure, and replacing him with someone that can convince the market they’re up for carrying the mantle and sprinting with it, isn’t going to be an overnight task.”
BP investors will not be pleased with the development as the company contends with mixed energy prices and increasing pressure to meet net-zero targets.
“The recent oil price spike only provides a limited cushion under BP’s valuation, with longer-term forecasters far more concerned about strategy and how well-prepared BP is for the energy transition,” Lund-Yates said.