D-Day for BP boss as activist moves to oust Murray Auchincloss

Investor Rebellion Targets BP Chief Executive at Upcoming Annual Meeting

BP CEO Murray Auchincloss is confronting a significant investor rebellion at the company’s annual meeting this week, posing a critical challenge to his leadership.

This threatened revolt follows chairman Helge Lund’s earlier concession to investor pressure, announcing his plans to resign next year. The move has emboldened activist shareholders seeking further changes at the energy giant.

Elliott Management Leading Shareholder Opposition

Activist investors, notably the prominent US fund Elliott Management, which has amassed a 5 percent stake in BP, are expected to oppose the re-election of Auchincloss as chief executive at Thursday’s assembly. This signals deepening unease among key stakeholders regarding the direction of the company.

‘I anticipate Elliott and other investors will vote against Auchincloss,’ stated Ashley Kelty, an analyst at broker Panmure Liberum. He highlighted a ‘growing sentiment within the market’ suggesting that BP requires a new chief executive alongside a replacement chairman to navigate current challenges effectively.

Board Positions Under Scrutiny Amidst Investor Pressure

Sources within the City indicate that no member of the BP board can consider their position entirely secure amid the unfolding investor activism. Non-executive directors, including Amanda Blanc, CEO of insurer Aviva and BP’s senior independent director, are also facing increased scrutiny. Blanc is currently leading the search to identify Lund’s successor, a process now further complicated by the broader shareholder unrest.

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Strategic Shift to Oil and Gas Intensifies Pressure on Auchincloss

This potential shareholder revolt adds considerable pressure on Auchincloss as he continues to implement plans to re-focus BP on oil and gas. This strategic pivot marks a departure from a previously emphasized transition towards green energy, a move that has proven unpopular with some investors and environmental groups alike.

Financial Performance and Share Price Decline Fuel Discontent

BP recently disclosed that its debt increased by £3 billion in the first quarter of the year, coinciding with reduced production and weaker performance in natural gas trading. Compounding these issues, a recent sharp decline in global oil prices, influenced by factors such as Donald Trump’s tariff policies and amplified production from the Opec+ cartel, is expected to further strain BP’s financial standing.

Investors have been increasingly vocal in demanding significant leadership changes to revitalize the company’s share price. The firm’s stock value has decreased by over 30 percent in the preceding year, underscoring shareholder dissatisfaction and the urgency for strategic and operational adjustments.

Auchincloss’s Attempts to Appease Investors

In an attempt to address mounting discontent, Auchincloss has moved to reduce BP’s investment in green energy ventures by nearly £4 billion annually. Simultaneously, he has committed to increasing oil and gas investment by 20 percent, allocating nearly £8 billion to these sectors. Furthermore, Auchincloss has publicly pledged to more than double BP’s valuation to £160 billion within five years, aiming to restore levels not witnessed since before the Deepwater Horizon disaster in 2010.

Despite these efforts, Elliott Management remains unconvinced, and Auchincloss is also facing opposition from environmental advocates. Climate-conscious shareholders are increasingly likely to oppose his position due to the revised strategic direction, adding complexity to his efforts to maintain broad support.

Legal & General’s Opposition to Chairman Re-election

BP encountered a setback when Legal & General (L&G), holding a 1.8 percent stake in the company, announced its intention to vote against Lund’s re-election as chairman at the annual meeting. This public stance amplifies the pressure for Lund’s early departure and signals broader institutional investor apprehension.

The insurer cited ‘significant concerns’ regarding BP’s decision to scale back its green energy strategy without seeking a shareholder vote, highlighting a governance issue that resonates with many investors focused on sustainability and long-term value.

Elliott Management has declined to issue a public statement on the unfolding situation.