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Yahoo
17-04-2025
- Business
- Yahoo
Major shareholder revolt against BP chairman amid climate clash
Outgoing BP chairman Helge Lund received a near 25% vote against his reelection at the UK oil major's annual general meeting in a shareholder revolt. The company's board was dealt a bloody nose from shareholders as it faced conflicting pressures over climate goals during the meeting at its Sunbury-on-Thames hub on Thursday. It follows BP announcing a drastic shift away from investing in renewables in February after some shareholders pushed for a refocus on fossil fuels to boost its profits and share price, which have lagged behind its rivals. But ahead of the AGM, a group of 48 institutional investors criticised the board for not offering a direct vote on the oil major's revised strategy, while environmental groups fiercely criticised the climate row-back. A resolution for Mr Lund's reelection received a provisional 24.3% of opposed votes, which marks a major rebuttal for a FTSE 100 company. Mr Lund, who played a key role in setting BP's green agenda, announced he will step down as the company plots a new course, meaning votes against his reelection were largely seen as a protest. Tarek Bouhouch, from the activist group Follow This, argued a vote against of 10% or more would have a 'sole ESG purpose' and send a 'strong signal'. According to the campaign group, a vote against the chairman likely never breached 10% in the firm's history, or at least in the last decades. 'Double digits is history,' Mr Bouhouch said, claiming BP had never seen an oppose vote hit 10% at an AGM, at least not in the last decade. During the 90-minute meeting, board members and executives discussed the new strategy, with a large sign saying 'A reset bp' on the set above their seats. Mr Lund spoke about recent concerns over energy costs and security and 'more complex' geopolitical and trade tensions, adding that this uncertainty 'has had an impact on BP'. 'The company pursued too much while looking to build new low-carbon businesses,' he said. The chairman sought to assure shareholders that 'lessons have been learned', adding that every board meeting in the last year had been focused on a new strategy. Chief executive Murray Auchincloss told the meeting: 'We were optimistic for a fast transition but that optimism was misplaced.' 'A fundamental reset was needed which is exactly what we've done,' he added, telling investors that the board's 'one simple goal' is to 'grow the long-term value of your investment. 'We recognise the valuation gap between BP and our peers and we intend to close it,' he said. Mr Auchincloss also claimed the energy 'transition remains important for BP' but that the company will be 'disciplined' about how it invests in green technologies going forward. Matt Crossman, from institutional investor Rathbones, asked the board why shareholders had not been offered the vote on the new strategy, citing the fact that a large swathe of shareholders voted in support of their previous net-zero plan in 2022. Mr Lund argued that they have been encouraged by shareholder support for the reset after 'very very comprehensive engagement' in recent weeks. 'The majority of our shareholders are not asking for a vote on climate,' he said. He also argued BP's net-zero ambition by 2050 is 'consistent' with UN climate goals, adding that details were laid out 'very very extensively' in its annual report. Later asked about how US President Donald Trump's tariffs are affecting the business, Mr Murray said: 'Overall, the impact on our business so far is not material.' Amanda Blanc, a senior independent director at BP who is leading the process to find Mr Lund's successor, also revealed that the search is under way and moving at pace. Back in 2020, BP announced some of the most ambitious goals among fossil fuel companies to cut oil and gas production by 40% by 2030 and invest heavily in renewables. However, BP has now said it wants to increase its production to between 2.3 million and 2.5 million barrels of oil per day by 2030. It came after it made about £7.2 billion in profit last year, which was down a third compared to the year before, after oil and gas prices fell from the highs seen in the wake of Russia's invasion of Ukraine. But the move, which contradicts guidance by global energy bodies designed to help limit climate change, has angered some shareholders and environmental groups. According to the International Energy Agency, no new fossil fuel projects are compatible with limiting global warming to 1.5C compared with pre-industrial levels, a goal adopted by most of the international community.
The Independent
17-04-2025
- Business
- The Independent
Major shareholder revolt against BP chairman amid climate clash
Outgoing BP chairman Helge Lund received a near 25% vote against his reelection at the UK oil major's annual general meeting in a shareholder revolt. The company's board was dealt a bloody nose from shareholders as it faced conflicting pressures over climate goals during the meeting at its Sunbury-on-Thames hub on Thursday. It follows BP announcing a drastic shift away from investing in renewables in February after some shareholders pushed for a refocus on fossil fuels to boost its profits and share price, which have lagged behind its rivals. But ahead of the AGM, a group of 48 institutional investors criticised the board for not offering a direct vote on the oil major's revised strategy, while environmental groups fiercely criticised the climate row-back. A resolution for Mr Lund's reelection received a provisional 24.3% of opposed votes, which marks a major rebuttal for a FTSE 100 company. Mr Lund, who played a key role in setting BP's green agenda, announced he will step down as the company plots a new course, meaning votes against his reelection were largely seen as a protest. Tarek Bouhouch, from the activist group Follow This, argued a vote against of 10% or more would have a 'sole ESG purpose' and send a 'strong signal'. According to the campaign group, a vote against the chairman likely never breached 10% in the firm's history, or at least in the last decades. 'Double digits is history,' Mr Bouhouch said, claiming BP had never seen an oppose vote hit 10% at an AGM, at least not in the last decade. During the 90-minute meeting, board members and executives discussed the new strategy, with a large sign saying 'A reset bp' on the set above their seats. Mr Lund spoke about recent concerns over energy costs and security and 'more complex' geopolitical and trade tensions, adding that this uncertainty 'has had an impact on BP'. 'The company pursued too much while looking to build new low-carbon businesses,' he said. The chairman sought to assure shareholders that 'lessons have been learned', adding that every board meeting in the last year had been focused on a new strategy. Chief executive Murray Auchincloss told the meeting: 'We were optimistic for a fast transition but that optimism was misplaced.' 'A fundamental reset was needed which is exactly what we've done,' he added, telling investors that the board's 'one simple goal' is to 'grow the long-term value of your investment. 'We recognise the valuation gap between BP and our peers and we intend to close it,' he said. Mr Auchincloss also claimed the energy 'transition remains important for BP' but that the company will be 'disciplined' about how it invests in green technologies going forward. Matt Crossman, from institutional investor Rathbones, asked the board why shareholders had not been offered the vote on the new strategy, citing the fact that a large swathe of shareholders voted in support of their previous net-zero plan in 2022. Mr Lund argued that they have been encouraged by shareholder support for the reset after 'very very comprehensive engagement' in recent weeks. 'The majority of our shareholders are not asking for a vote on climate,' he said. He also argued BP's net-zero ambition by 2050 is 'consistent' with UN climate goals, adding that details were laid out 'very very extensively' in its annual report. Later asked about how US President Donald Trump's tariffs are affecting the business, Mr Murray said: 'Overall, the impact on our business so far is not material.' Amanda Blanc, a senior independent director at BP who is leading the process to find Mr Lund's successor, also revealed that the search is under way and moving at pace. Back in 2020, BP announced some of the most ambitious goals among fossil fuel companies to cut oil and gas production by 40% by 2030 and invest heavily in renewables. However, BP has now said it wants to increase its production to between 2.3 million and 2.5 million barrels of oil per day by 2030. It came after it made about £7.2 billion in profit last year, which was down a third compared to the year before, after oil and gas prices fell from the highs seen in the wake of Russia's invasion of Ukraine. But the move, which contradicts guidance by global energy bodies designed to help limit climate change, has angered some shareholders and environmental groups. According to the International Energy Agency, no new fossil fuel projects are compatible with limiting global warming to 1.5C compared with pre-industrial levels, a goal adopted by most of the international community.
The Independent
16-04-2025
- Business
- The Independent
BP set for shareholder clash over climate goals as AGM season kicks off
BP is set for a clash between shareholders over its climate goals as the season for annual general meetings (AGM) kicks off. The oil major's board is likely to face conflicting pressures during the meeting at its Sunbury-on-Thames hub on Thursday, with some investors backing a bigger slowdown in climate action while others protest against its recent retreat. BP announced a drastic shift away from investing in renewables in favour of more oil and gas earlier this year, claiming that it went 'too far, too fast' on green energy. Some shareholders had pushed for a refocus on fossil fuels in a bid to boost its profits and share price that have lagged behind its rivals. BP's AGM opens a proxy season that could be overshadowed by uncertainty after US President Donald Trump's election accelerated corporate America's shift away from environment, social and governance (ESG) principles and encouraged energy giants to focus more on fossil fuels. On the other hand, the UK energy giant's recent green retreat has angered environmental groups and contradicts guidance by global energy bodies designed to help limit climate change. A group of 48 institutional investors recently also criticised the firm for not offering a direct vote on the oil major's revised strategy. In protest, some shareholders are expected to vote against the resolution to reappoint chairman Helge Lund on Thursday as a way of expressing their dissatisfaction with the revised strategy. Mr Lund, who played a key role in setting BP's green agenda, recently announced he will step down in 'due course' as the company plots a new course. Given his impending departure, Tarek Bouhouch, from activist group Follow This, said a vote against the reappointment would have a 'sole ESG purpose' and send a 'strong signal'. 'BP has made a hasty, we even say panic-mode, U-turn on their climate promises,' he told the PA news agency. 'It took them a couple of weeks to scrub clear their five-year-old pledges.' Follow This is not filing its usual climate resolutions at oil majors this year following political ESG setbacks and legal threats – having been sued by US giant ExxonMobil last year. 'We decided not to file amid a lot of uncertainty with regards to shareholders' rights and the economic fundamentals that are (being) debated and have had a chilling effect on the engagement for 2025,' Mr Bouhouch said. Follow This instead hopes the oppose vote will reach at least 10%, marking a record high for opposition to board member reappointments at UK oil majors in at least the last decade. Meanwhile, the decision not to file a shareholder resolution is part of a wider slowdown in activism this year. Investors pressing companies on ESG matters filed a total of 355 shareholder proposals as of February 21 – down from 536 filed at the same point in 2024 and 542 filed at the same point in 2023, according to a report from activist group As You Sow. Penny Fowler, co-director of corporate engagement at ShareAction, said that this proxy season responsible investors 'are rightly concerned about what the long-term financial risks of compounding climate change (are) and are asking that these powerful companies play their part in preventing the worst effects of global heating'. ' Communities around the world are grappling with the snowballing of harmful impacts from our changing climate, from super-storms to extreme heat and drought,' she said. Back in 2020, BP announced some of the most ambitious goals among fossil fuel companies to cut oil and gas production by 40% by 2030 and invest heavily in renewables. However, BP has said it now wants to increase its production to between 2.3 million and 2.5 million barrels of oil per day by 2030. According to the International Energy Agency, no new fossil fuel projects are compatible with limiting global warming to 1.5C compared with pre-industrial levels, a goal adopted by most of the international community.
Yahoo
16-04-2025
- Business
- Yahoo
BP set for shareholder clash over climate goals as AGM season kicks off
BP is set for a clash between shareholders over its climate goals as the season for annual general meetings (AGM) kicks off. The oil major's board is likely to face conflicting pressures during the meeting at its Sunbury-on-Thames hub on Thursday, with some investors backing a bigger slowdown in climate action while others protest against its recent retreat. BP announced a drastic shift away from investing in renewables in favour of more oil and gas earlier this year, claiming that it went 'too far, too fast' on green energy. Some shareholders had pushed for a refocus on fossil fuels in a bid to boost its profits and share price that have lagged behind its rivals. BP's AGM opens a proxy season that could be overshadowed by uncertainty after US President Donald Trump's election accelerated corporate America's shift away from environment, social and governance (ESG) principles and encouraged energy giants to focus more on fossil fuels. On the other hand, the UK energy giant's recent green retreat has angered environmental groups and contradicts guidance by global energy bodies designed to help limit climate change. A group of 48 institutional investors recently also criticised the firm for not offering a direct vote on the oil major's revised strategy. In protest, some shareholders are expected to vote against the resolution to reappoint chairman Helge Lund on Thursday as a way of expressing their dissatisfaction with the revised strategy. Mr Lund, who played a key role in setting BP's green agenda, recently announced he will step down in 'due course' as the company plots a new course. Given his impending departure, Tarek Bouhouch, from activist group Follow This, said a vote against the reappointment would have a 'sole ESG purpose' and send a 'strong signal'. 'BP has made a hasty, we even say panic-mode, U-turn on their climate promises,' he told the PA news agency. 'It took them a couple of weeks to scrub clear their five-year-old pledges.' Follow This is not filing its usual climate resolutions at oil majors this year following political ESG setbacks and legal threats – having been sued by US giant ExxonMobil last year. 'We decided not to file amid a lot of uncertainty with regards to shareholders' rights and the economic fundamentals that are (being) debated and have had a chilling effect on the engagement for 2025,' Mr Bouhouch said. Follow This instead hopes the oppose vote will reach at least 10%, marking a record high for opposition to board member reappointments at UK oil majors in at least the last decade. Meanwhile, the decision not to file a shareholder resolution is part of a wider slowdown in activism this year. Investors pressing companies on ESG matters filed a total of 355 shareholder proposals as of February 21 – down from 536 filed at the same point in 2024 and 542 filed at the same point in 2023, according to a report from activist group As You Sow. Penny Fowler, co-director of corporate engagement at ShareAction, said that this proxy season responsible investors 'are rightly concerned about what the long-term financial risks of compounding climate change (are) and are asking that these powerful companies play their part in preventing the worst effects of global heating'. 'Communities around the world are grappling with the snowballing of harmful impacts from our changing climate, from super-storms to extreme heat and drought,' she said. Back in 2020, BP announced some of the most ambitious goals among fossil fuel companies to cut oil and gas production by 40% by 2030 and invest heavily in renewables. However, BP has said it now wants to increase its production to between 2.3 million and 2.5 million barrels of oil per day by 2030. According to the International Energy Agency, no new fossil fuel projects are compatible with limiting global warming to 1.5C compared with pre-industrial levels, a goal adopted by most of the international community.
Yahoo
15-04-2025
- Business
- Yahoo
BP Faces Shareholder Showdown Amid Oil Price Crash
BP is holding its annual general meeting on April 17 in the early days of its strategy reset to return to its core oil and gas business while oil prices have crashed by more than $10 per barrel this month. Shareholders, especially activist hedge fund Elliott, will want to make their position known at the AGM votes on Thursday. Activist investor Elliott, which has been pushing for dramatic changes at BP since amassing a 5% stake in the supermajor, is likely to express its continued frustration with BP's performance by voting against the re-election of directors. Fortunately for BP, one of the constant campaigners that has been pushing for years for shareholder resolutions on emissions and climate accountability at AGMs, Follow This, has just decided to pause its climate resolutions at Big Oil – for the first time since 2016 – citing investor hesitation about ESG investments and campaigning.'Shareholder resolutions have been critical in compelling five oil majors to set emissions reduction targets, but most institutional investors are reluctant to use their voting power,' Mark van Baal of Follow This said last week ahead of the AGMs at the oil and gas supermajors. 'It's a strategic pause to get more investors on board and to discuss how to work together to uphold shareholder rights.' The backlash against ESG, combined with the trade war, has left investors uncertain about how to proceed with climate action, Follow This said. The climate campaign group noted that it 'speaks with investors about addressing these barriers, exploring what prevents investors, like BlackRock, LGIM, and NBIM, from casting their votes in favour of Paris-alignment despite their public climate commitments.' In BP's case, however, the step-back of Follow This appears to be the only good news for the company and its management these days. BP's shares continue to lose more than its peers, including Shell and the U.S. supermajors, and have dipped in value more than those of the other majors during the oil price rout triggered by fears of weaker oil demand in light of the trade wars and uncertainty about tariffs. Year to date, BP's stock has plunged by 18% despite the strategy reset announced at the end of February. To compare, Shell's shares have lost 13% so far this year, while Exxon and Chevron have dropped by 4% and 6% respectively—much less than the oil price decline. BP's strategy reset has failed to lift its stock performance despite the supermajor walking back on renewable energy spending and stepping up investment in fossil fuels. BP vowed to increase its investment in upstream oil and gas to $10 billion per year while slashing spending on clean energy by more than $5 billion a year. The pressure on BP became more intense this year after Elliott bought a nearly 5% stake in the supermajor and demanded changes in strategy or even board reshuffles. In a move seen as a win for Elliott, BP chair Helge Lund this month announced his intention to step down from the role 'most likely during 2026.' This announcement doesn't mean Elliott wouldn't vote against Lund or other board directors at the shareholders' meeting this week to express its dissatisfaction with how the company has been run. In a very unfortunate development for BP, any positive share performance from the strategy reset was obliterated within a month by the tariff and trade wars, which crashed the price of Brent Crude oil to the low $60s per barrel. Lower oil prices could test BPs ability to sustain its returns to shareholders, including dividends, especially as the supermajor flagged an increase in its net debt in the first quarter of 2025. BP warned of a weak natural gas trading result for the first quarter and said its net debt at quarter-end is expected to be around $4 billion higher compared to the fourth quarter, primarily due to a working capital build. This, BP said, is largely expected to reverse, reflecting seasonal inventory effects, timing of payments including annual bonus payments, and payments related to low carbon assets held for sale. But Elliott and other shareholders will want more, and BP could struggle to deliver. By Tsvetana Paraskova for More Top Reads From this article on
