Claw back ex-BP boss Bernard Looney’s £13m bonuses: Oil giant under pressure to take back millions paid to disgraced tycoon after he dramatically quit amid storm of controversy – as shares plunge following shock resignation
BP was today under pressure to claw back millions in bonuses paid to disgraced ex-boss Bernard Looney.
Mr Looney last night quit the oil giant after he admitted misleading the board over past relationships with colleagues.
He has been paid £16.2million by BP including £13million in bonuses and share awards since he took over in February 2020.
But he dramatically resigned last night after admitting that 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.
Under BP’s pay policy, bonuses can be clawed back under a series of circumstances including ‘material misconduct or other exceptional circumstances’.
BP shares plunged nearly one percent to 518.20 pence at midday on the FTSE 100 index after Mr Looney’s resignation.
Sir Vince Cable, the former business secretary who brought in clawback rules during the Coalition, said it was ‘absolutely incumbent’ on BP to take back Mr Looney’s bonus.
Bernard Looney talks during the Abu Dhabi International Petroleum Exhibition & Conference in Abu Dhabi in October 2022
BP shares plunged nearly one percent to 518.20 pence at midday on the FTSE 100 index after Mr Looney’s resignation
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. This was a modest step forward. It is absolutely incumbent that the chairman of the board, and the board, crack down and deal with abuses.’
Read more – The ‘unlikely oil man’ who grew up on a dairy farm and dumped his wife via WhatsApp
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.’
The Institute of Directors, which represents business leaders across the economy, said most of its members agreed that companies must be allowed to recover or withhold bonuses ‘in case of misconduct or wrongdoing’.
Roger Barker, IoD director of policy and governance, said: ‘It is important for the reputation of the entire business community that top managers are not seen as benefiting from significant misconduct.
‘Companies should define clear standards of behaviour and ensure that their reward structures are fully aligned with them.’
The departure of Mr Looney, a 53-year-old Irishman who has spent his whole career with the company, stunned the City.
Chief financial officer Murray Auchincloss has replaced him on an interim basis while chairman Helge Lund leads the hunt for a successor.
The board’s decision to hire Mr Looney in the first place may now come under scrutiny.
Bernard Looney, 53, shocked the City by stepping down as CEO after admitting he had not been ‘fully transparent’ during a probe into past relationships with colleagues
Mr Looney spent nearly three decades climbing the ranks at BP, having started out as a drill engineer in the North Sea near Aberdeen in 1991
Mr Lund said at the time that the incoming chief executive had ‘all the right qualities to lead us through this transformational era’ and that he 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 the company 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.
However, the board ‘sought and was given assurances by Mr Looney regarding disclosure of past personal relationships as well as his future behaviour’.
A sign at a BP petrol station in London
But after further allegations ‘of a similar nature’ were received 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 and accepts he was obligated to more complete disclosure’.
BP said that no decisions had been made ‘in respect of any remuneration payments’ to him.
But Mr Looney is no longer receiving a salary because has resigned with immediate effect.
After growing up on a farm in Ireland, Mr Looney rose through the ranks of BP after joining as a drill engineer in 1991 and has worked across BP’s operations including in Alaska, the Gulf of Mexico, Vietnam and the North Sea.
He divorced his wife of two years, Jacqueline Hurst, shortly before he became chief executive in 2020. She reportedly later claimed that he dumped her via WhatsApp.
Nick Butler, former head of strategy at BP, told Sky News: ‘He has Irish charm. I think he probably kissed the Blarney Stone ay a pretty early age. He can charm anybody.’
Source: Read Full Article