BP shareholders punish chair Helge Lund with low support

BP’s CEO Murray Auchincloss and Chair Helge Lund were re-elected on Thursday, although the sharply reduced level of shareholder support for Lund could mean his previously announced departure is sooner than expected.

BP’s board was up for re-election at its annual general meeting as the group faces activist shareholder Elliott Management and criticism from climate-focused investors, some of whom had called for a vote against Lund.

BP, whose stock has been underperforming rivals including Shell and Exxon for years, has been working to boost its share price. That pressure increased after Elliott Management built up a nearly 5% stake in recent months.

Auchincloss received 97% of votes and Lund an unusually low 75.7%, provisional results showed.

Board members need 50% of votes to be elected and typically achieve tallies near 100%.

Lund announced this month he would step down likely in 2026.

Board member Amanda Blanc, who is in charge of finding Lund’s successor, told shareholders before poll results were announced that it was in everyone’s interest to keep the transition period as brief as possible and that the search was underway.

Both Lund and Auchinloss had supported previous chief Bernard Looney’s 2020 plan to cut BP’s oil and gas output by 40% this decade and invest heavily in renewables. A few months later BP started backtracking.

In February, Auchincloss, who was finance chief under Looney, said BP would completely abandon the plan and renew its focus on oil and gas.

Some climate-focused investors are unhappy that BP did not offer a vote on the strategy U-turn.

“Why aren’t we voting on that level of (climate) ambition?”, said Matt Crossman, stewardship director at UK asset management company Rathbones.

Legal & General, a top-10 BP shareholder according to LSEG data, meanwhile, called for a vote against Lund, citing climate and governance goncerns.

Lund told shareholders the board had been encouraged by the level of support in its engagement with shareholders and it had not seed a majority asking for a so-called Say on Climate vote.

He also told shareholders BP had learnt from mistakes.

“The company pursued too much while looking to build new low carbon businesses. And some existing businesses did not operate with the expected reliability and efficiency. I can assure you lessons have been learned from this,” he said.

Elliott Management did not ask BP’s board any questions at Thursday’s meeting.

Influential proxy advisers Institutional Shareholder Services Inc (ISS) and Glass Lewis had recommended that shareholders vote in favour of the re-election of BP’s 12-member board.