BP leadership exits reignite questions over board structure, oversight
CEO of BP Meg O’Neill attends a UK-U.S. trade event with King Charles III at Bar SixtyFive at Rockefeller Center during a state visit on April 29, 2026 in New York City.
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BP is on its third CEO and third chairman in under three years, prompting investor scrutiny of the structure and oversight of its board as the oil major works to turn itself around and adapt to the supply shock.
Weeks after CEO Meg O’Neill started in April, the chairman, Albert Manifold, was suddenly dismissed in late May. The board said this was due to “serious concerns” relating to governance standards, oversight and conduct.
Manifold said he had been fired “without warning and without explanation,” adding he disputes “entirely the characterisation” of his conduct.
One of the oil supermajor’s top active investors told CNBC that some may be in danger of missing the bigger picture, while an activist shareholder said the company urgently needed to address the reasons for the turnover.
‘A chaotic period of leadership turnover’
Nick Mazan, oil and gas strategy lead at activist shareholder ACCR, said BP had to provide “a clear and honest reflection” about the selection process that led to Manifold’s appointment.
“The nomination process appears to be dysfunctional. No large cap company should have had three CEOs and chairs in as many years,” Mazan told CNBC by email.
“There are understandably major questions about whether the board, as presently constituted, having presided over a chaotic period of leadership turnover, is up to the task of identifying a new chair and challenging the CEO on the current strategy of increased upstream spending,” he continued.
William Lin, executive vice president, regions, corporates & solutions of BP Plc, attends India Energy Week 2023 in Bengaluru, India, on Monday, Feb. 6, 2023.
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“It’s difficult to see how the company can rebuild trust and confidence with investors. A more active role from shareholders in the board nominations process may be required.”
When asked for comment, BP referred CNBC to comments by Ian Tyler, the firm’s interim chair, who said on the day of Manifold’s dismissal: “The Board and leadership team have deep conviction in the strategic direction we have laid out, and the company is moving at pace to deliver it.”
O’Neill is seeking to simplify the company’s structure by returning to an upstream and downstream model, part of a pivot away from renewables and back to its core business of oil and gas.
The company said Tuesday that Gordon Birrell will lead its upstream unit, which focuses on oil and gas, and Richard Harding will be interim head of the downstream unit, which includes refining, terminals, biofuels, and aviation.
Long-standing executive William Lin will leave later this year, the company announced last week.
Brian Kersmanc, portfolio manager at GQG Partners, one of BP’s largest active investors, said investors were “missing the forest for the trees” over the personnel departures.
“I think the overall strategic direction of BP and the progress they’ve already made is more impactful than personnel shakeups,” Kersmanc told CNBC by email.
Kersmanc added that BP boasts “extremely strong and diverse assets,” while the market appears to be valuing the company more like a mid-cap shale producer than a global integrated oil major.
“We think the rate of free cash flow they will be able to produce will increase, especially if we see higher energy prices for longer,” he added.
What does BP’s leadership turnover mean for investors?
Maurizio Carulli, global energy analyst at wealth manager Quilter Cheviot, said Manifold’s removal and Lin’s exit were unrelated, and the impact was likely to be limited.
“While the news may be viewed negatively in the short term, it is important to remember that BP has refocused its strategy and made significant operational improvements over the past year,” Carulli said.
“These changes reflect the efforts of the wider organisation and its management team, rather than being reliant on any single individual.”
John Browne, who was BP CEO for 13 years until 2007, told CNBC’s “Executive Decisions” that not all of the problems facing the oil major are systemic.
He said “a lot of things” had changed over the last 20 years, “not least shareholders’ determination that the oil and gas industry should go back to its roots and spend more of its capital.”
BP needs to “stabilize for the future,” Browne said in the wide-ranging interview with Steve Sedgwick. “It’s so clear to me that, unless the leadership is A grade, not B grade, not A minus, A, or A plus grade, and it’s stable. You will not make good returns,” Browne said.
When asked whether BP’s new CEO is an A-grade leader, Browne said it’s “too early to tell.”
“I know Megan very well, and I helped her for a period of time when she was at Woodside, and I wish her all good fortune. But in the end, you can never [know]. She has great promise, but you can never talk about anybody until it’s all over,” he said.
When asked what the personnel changes mean for investors, Quilter Cheviot’s Carulli said multiple layers of management at such large organizations mean that “the departure of a single individual, however senior, should not materially affect the overall business.”
“It is important that BP’s board runs a thorough and well-considered process to appoint a new chair, including reflecting on any lessons from the circumstances surrounding Albert Manifold’s departure,” he added.