Even though energy giant BP (LON: BP) is remaining tight lipped, the hunt for its next CEO will likely drag on well into Q1 2024. The FTSE 100 company has been without a permanent boss since the unceremonious departure of Bernard Looney in September.
Murray Auchincloss – the company’s Chief Financial Officer – has been at the helm of BP on an interim basis ever since. Their are clear signs the market is getting impatient about the turmoil at BP caused by Looney’s departure and the lack of updates on his successor.
Since September 12, when Looney’s exit was announced, BP’s share price has fallen by nearly 11%. Although earlier this month, the company announced its decision to claw back £32.43 million ($40 million) from its former boss having found him guilty of serious misconduct.
In the eyes of many, interim boss Auchincloss is well placed for getting the job full-time. But in the absence of an update from BP, speculation is rife both about the process as well as the prime candidates for the top job at the energy giant.
In November, Sky News reported that headhunter Egon Zehnder had been called in to identify BP’s next CEO. Earlier this month, BP’s Head of Trading and Shipping Carol Howle and Head of Customers and Products Emma Delaney were tipped as contenders for the top job alongside Auchincloss, according to a Reuters report citing industry and company sources.
BP is also reportedly considering external candidates. But hiring an internal candidate would indicate a continuation of the company’s current strategy of upping green investments started by Looney upon his appointment as CEO in 2020.
The decision, as I have noted before, may have far reaching near- to medium-term implications for BP’s share price. The new boss will have to unlock value from viable oil and gas plays while at the same time invest pragmatically in green energy and cleantech plays – a delicate balancing act that Looney didn’t manage all that well.
So its understandable the process is taking time. However, four months and counting is a lot given BP’s stature as a blue-chip energy firm, and hopes of investors looking for a speedy replacement for Looney in 2023 have already been dashed.
But there is a key date on the horizon – the company’s Q4 2023 results and dividend announcement on February 6, 2024. Smart money suggests BP’s next boss could well be named on the day or immediately thereafter. Any later than that and the markets may take a very dim view.