Bernard Looney, the CEO of BP, has admitted he wasn’t honest about the relationships he’d had with colleagues. It has cost him his job.
So what? Looney is the latest in a string of high-profile executives forced to resign as boards reckon with a new standard for disclosing personal relationships at work. His resignation demonstrates a problem that algorithms can’t solve. Namely, the task of boards to determine when a romantic relationship is predatory or discriminatory – and when it’s just human nature.
What we know. In May 2022 an anonymous whistleblower complained about Looney’s personal relationships with “a small number” of colleagues. BP’s statement says that no breach of conduct was found and Looney gave assurances to the board “regarding disclosure of past personal relationships, as well as his future behaviour”.
Then, a fortnight ago, another anonymous tip-off was received regarding his historic relationships – before he was appointed to the top job – as well as fresh claims about his conduct during his time as CEO. After lawyers assisted an investigation by the board, Looney admitted “he had not been fully transparent”.
BP has yet to clarify exactly
- how many people the allegations concern
- the nature of those relationships
- what due diligence was undertaken by the board during Looney’s appointment
BP referred Tortoise to the statement issued on Tuesday.
A former employee of the company during Looney’s tenure described it as “interesting and unusual” that he had been forced to resign so abruptly. “This only comes into play because the board has chosen to put it into play, perhaps for instance because a legal line has been crossed,” they said.
Legal risks will be a consideration if Looney has broken the company’s code of conduct. It warns against any “intimate relationship with someone whose pay, advancement or management you can influence”.
But that might not be the only factor informing the decision by chairman Helge Lund and BP’s board of directors. They’ll also be acutely aware of
History. Only one of the last four BP CEOs have decided their retirement date: Bob Dudley. John Browne quit after it was revealed he had lied to a court about his relationship with another man. Tony Hayward stepped down in 2010 over a rather more serious issue: the mishandling of the Deepwater Horizon environmental disaster.
Looney’s departure follows several high-profile exits of CEOs whose relationships with staff were deemed inappropriate, including:
- Jeff Zucker, ex-CEO of CNN, who left after failing to disclose a long-term relationship with Allison Gollust, the network’s executive vice president.
- Laurent Potdevin, ex-CEO of Lululemon, who lost his job after it was revealed he had an affair with a designer from the company.
- Steve Easterbrook, who was fired in 2019 for exercising “poor judgement” by sexting a McDonald’s employee.
Transparency is key. The McDonald’s board said Easterbrook had lied about his affairs. A desire for privacy is reasonable, especially if an office relationship is extramarital, but being opaque about liaisons at work provides cover for a range of bad behaviour.
Business has, however, come a lot further than politics. The precise number of Boris Johnson’s children remains a mystery, while Donald Trump has been found liable for sexual abuse and is still the frontrunner for the Republican 2024 presidential nomination.
Strategy. Under Looney, and with support of the board, BP made a shift towards green energy. It started with forays into solar and wind – an experiment which didn’t please investors. Earlier this year it shifted again, with a refocus on bio-energy, EV charging points, hydrogen and smaller cuts to oil and gas production. Now Looney’s gone there’s concern the strategy will become even more fossil-friendly in a bid to boost the share price.
Interim CEO Murray Auchincloss and Helge Lund gave a short town hall presentation to staff on Wednesday. They said BP’s strategy and quarter on quarter performance focus was unchanged and that 2025 targets remain key. The leadership team will reportedly stay the same.
Succession. Helge Lund has told employees the hunt has started – internally and externally – for a new permanent CEO. Potential internal successors include Auchincloss; William Lin who served on Looney’s leadership team; Anja-Isabel Dotzenrath who leads the gas and low-carbon business; and Gordon Birrell, executive VP for production. An external hire would be unusual but one name in the mix is Tufan Erginbilgic, CEO of Rolls Royce Holdings.
Whomever the board appoints, you can bet that they’ll be getting a rigorous background check.
