More than £2billion is wiped from BP’s share price as investors reel from shamed boss Bernard Looney’s resignation for not coming clean about past relationships with colleagues
- BP’s market valuation dropped from £90.8B to £88.2B after Looney’s resignation
More than £2billion was wiped from BP’s share price as investors reeled over the shock departure of disgraced ex-boss Bernard Looney.
Mr Looney quit the oil giant on Tuesday after he admitted misleading the board over past relationships with colleagues.
He resigned after saying he had not been ‘fully transparent’ during a probe in 2022 following allegations about his private life. That same year, he was paid a total of £10million, including £8.4million in bonus and share awards.
After his resignation BP’s market valuation dropped from £90.8billion to £88.2billion and dragged London’s FTSE 100 lower. The UK’s biggest pension funds, which have around £500million invested in BP, also took a hit yesterday, The Sun reported.
It comes as BP is under pressure to claw back millions in bonuses paid to Mr Looney. He has been paid £16.2million by BP including £13million in bonuses and share awards since he took over in February 2020.
More than £2billion was wiped from BP’s share price as investors reeled over the shock departure of disgraced ex-boss Bernard Looney. Mr Looney quit the oil giant on Tuesday after he admitted misleading the board over past relationships with colleagues
After his resignation BP’s market valuation dropped from £90.8billion to £88.2billion and dragged London ’s FTSE 100 lower. The UK’s biggest pension funds, which have around £500million invested in BP, also took a hit yesterday
Under BP’s pay policy, bonuses can be clawed back under a series of circumstances including ‘material misconduct or other exceptional circumstances’.
Sir Vince Cable, the former business secretary who brought in clawback rules during the Coalition, said it was incumbent on BP to take back Mr Looney’s bonus.
Sir Vince, who previously worked as chief economist at BP’s rival Shell, said: ‘One of the things that I and my colleagues did was giving shareholders more power to deal with the pay of their senior executives who were abusing it.
‘It is absolutely incumbent that the chairman of the board, and the board, deal with abuses.’
Luke Hildyard, director of the High Pay Centre, a campaign group, said the 2022 bonus must be paid back to BP. ‘It would make a mockery of the clawback provisions that companies are supposed to include in incentive payments if it wasn’t,’ he said.
‘This incident has caused some pretty major upheaval for the company, surely overriding the regulation responsibilities fulfilled in order to obtain the bonus.’
Roger Barker of the Institute of Directors, which represents business leaders across the economy, said: ‘It is important for the reputation of the entire business community that top managers are not seen as benefiting from significant misconduct.’
The departure of Mr Looney, 53, stunned the City. Chief financial officer Murray Auchincloss has replaced him on an interim basis as chairman Helge Lund leads the hunt for a successor.
Bernard Looney resigned after saying he had not been ‘fully transparent’ during a probe in 2022 following allegations about his private life
Away from work, he has been married to life coach and GQ Magazine columnist Jacqueline Hurst, who Masterchef’s Gregg Wallace credited with helping relieve his anxiety before his stint on last year’s Strictly Come Dancing
The board’s decision to hire Mr Looney in the first place may now come under scrutiny. Mr Lund said at the time that the incoming chief executive had ‘all the right qualities to lead us through this transformational era’ and was an ‘authentic, progressive leader, with a passion for purpose and people’.
The reasons behind Mr Looney’s resignation go back to May last year when BP was alerted by an anonymous source to claims about his past relationships. After it launched a review, Mr Looney ‘disclosed a small number of historical relationships with colleagues prior to becoming CEO’ but was found not to have breached BP’s code of conduct.
The board ‘was given assurances by Mr Looney regarding disclosure of past personal relationships as well as his future behaviour’.
But after further allegations ‘of a similar nature’ recently, the company said it began a fresh investigation – which remains ongoing.
On Tuesday Mr Looney ‘informed the company that he now accepts that he was not fully transparent in his previous disclosures’, BP said, adding that he ‘did not provide details of all relationships’.
BP said that no decisions had been made ‘in respect of any remuneration payments’ to him. Mr Looney is no longer receiving a salary because has resigned with immediate effect.
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