BP braces for investor rebellion at first AGM since climate strategy U-turn
BP is braced for an investor rebellion on Thursday as the oil company prepares to face its shareholders for the first time since abandoning its climate strategy.
Its chair, Helge Lund, is expected to be voted out of his job by disgruntled investors at the company’s annual general meeting, which is also likely to be marked by protest from climate campaigners and investors.
The shareholder meeting comes weeks after Lund, who presided over BP’s groundbreaking 2020 climate targets and the company’s subsequent retreat, promised to step down from the company by next year.
Despite his resignation, the chair will still face a shareholder vote on his role in which some of BP’s largest investors are expected to turn against him in protest over the company’s rapidly falling value in recent years.
The UK asset manager Legal & General, a leading shareholder in BP, has voiced plans to vote against Lund’s re-election citing the company’s recent green U-turn and its decision not to allow its shareholders to vote on the new direction.
The standoff will take place almost 15 years to the day after the deadly Deepwater Horizon disaster led to the largest marine oil spill in US history and plunged the company into a multi-billion dollar crisis.
The company announced this week an oil discovery in “the Gulf of America” – using Donald Trump’s newly mandated US name for the Gulf of Mexico – which it said underscored its plan to “step up investment in exploration”.
BP faces a fresh existential crisis after the activist hedge fund Elliott Investment Management amassed a stake in the company earlier this year. The feared New York fund typically takes aim at underperforming companies by agitating for changes that could resuscitate their flagging market value.
Elliott is expected to call for sweeping changes to the company, which has lagged behind its rivals such as Shell and ExxonMobil that have profited from the global energy market crisis in recent years by increasing their fossil fuel production.
BP’s chief executive, Murray Auchincloss, blamed “misplaced” optimism in the global green energy transition for the company’s decision to scrap plans to curb its fossil fuel production in favour of green investments.
Instead, BP aims to be “very selective” about investing in low-carbon options while growing its planned fossil fuel production to 2.4m barrels of oil and gas a day by 2030 – about 60% higher than the figure in its net zero plan set out five years ago.
