Power Players: Can new BP leadership steady the ship?

Will Bain (0:00)

Four chief executives and three board chairs since 2020 If I just gave you those stats alone, you'd think we're talking this week about a crisis company fighting for its very existence. But we're talking instead about a firm that just one month ago announced a 144% rise in its profits for the three months to June, its highest quarterly profit in four years. So what is going on at the energy company BP? What does it tell us about global energy supply and the politics around how we power our homes and businesses and transportation? And is the company that's full name is British Petroleum actually even British anymore?

Yeah, welcome back to Power Players from Business Daily on the BBC World Service. Will Bain here with you today, but flying solo today. No Rahul or Michelle this week. So I've enlisted a little bit of help and gone right to the top to do so. Someone who's covered the world's biggest companies for more than two decades has spent probably more time than he cares to think about trying to get to the bottom of our central question today of what is going on at BP, one of the world's biggest energy companies. That's the BBC's business editor, Simon Jack. Thanks for being with us.

Simon Jack (1:10)

A pleasure.

Will Bain (1:11)

How many years then have you been doing the wranglings of what's been going on at BP?

Simon Jack (1:16)

Well, it's been a strange one, BP, because it is, like you say, this is no two bit company. It's worth 90 billion pounds right now, $120 billion. It's one of the top 10 most valuable companies.

In the FTSE 100, so you can't be a business journalist without covering BP. It's absolutely central. Most people own it as part of their pension fund, so even if you don't know you own a few shares of BP, you probably do. So in a way that you've got some skin in the game here.

Will Bain (1:42)

We thought, even if you don't care about BP, perhaps you're listening somewhere in the world where you're not as au fait with this company as you and I are. That's what makes this an interesting story today, right? To sort of lay the table a bit for people, that this is a central issue going on all around the world, right? That we are trying to have or where there is lots of political push to have more of the green transition going on, changing, moving away from oil and gas more bluntly and everything we do, how we power businesses, travel, homes, etc.

But how you do that and still make money as a company, far from a BP only issue, right?

Simon Jack (2:14)

Correct. And when I talk to a lot of companies who set out their greener ambitions and not just oil and gas companies, but all companies, what they've told me is that the green transition has not happened as fast as they thought it would. In their nomenclature, they say it's all moved right.

And what they mean by moved right is it means into a time scale which is long and much further away than thought. The simple fact is that companies which prioritised oil and gas and maximised production of that made more money than those companies who were trying to both finance and make money out of a shift to renewables. And of course, all of that was put on steroids by the Russia Ukraine, oil prices just leapt up and then oil and gas companies were making tons of, they couldn't help but make a fortune because the price of what they were getting out of the ground was going up like crazy.

Will Bain (3:01)

So in 2020, a gentleman called Helga Lund was chairman of BP and Bernard Looney, who you've mentioned, Irish executive, was the chief executive. By 2023, it was Mr. Lund and Murray Orkincloss.

Then it was Albert Manenfold and Mr. Orkincloss as a partnership. Then in 2026, Mr. Manenfold and Meg O'Neill, and now, as me and you were talking in the last couple of weeks, Ian Tyler, Meg O'Neill in 2026 That is a lot. You come from an investment background a long time ago as well. That is the type of churn that investors don't tend to like very much, right?

Simon Jack (3:32)

No, that's like sort of having four different managers of a football club and four different chairman of the football club in that period. You know, you want a bit of stability, and that's pretty unusual in a company of this size and stature.

Now some of this was sort of self-inflicted own goals. Bernard Looney had relationships with his staff, but he wasn't honest with the board about. Mr. Ogan Kloss was promoted from CFO, did a reasonably safe pair of hands, but didn't have that kind of leadership magic and was seen as being too close to Looney.