BP’s board has suffered a triple climate rebellion in its first shareholder meeting since appointing new leadership to steer the embattled oil company.
More than 50% of shareholders voting at the company’s annual general meeting (AGM) came out against its plans to scrap its existing climate reporting, and its resolution to replace in-person annual shareholder meetings – a lightning rod for climate protest in recent years – with online-only events.
About 18% of shareholders voted against the re-election of BP’s chair, Albert Manifold, less than a year after he took on the role. The “unprecedented” revolt means BP will not be allowed to carry out the resolutions that were defeated by a majority, although Manifold will remain as chair.
The dissenting shareholders included Legal & General Investment Management (LGIM), the UK’s largest asset manager, which had said it would vote against Manifold and oppose BP’s plans to cut back on climate reporting.
Manifold was heavily criticised in the run-up to the AGM for putting forward a resolution to dilute BP’s climate disclosures, and for blocking a resolution from shareholder activists at the climate campaign group Follow This.
The influential proxy shareholder advisory Glass Lewis said Manifold was ultimately accountable for BP’s decision to exclude the Follow This resolution and recommended a vote against him on these grounds.
The resolution called on BP to explain how its pursuit of rising oil and gas production aligned with a world shifting away from fossil fuels.
“The question is simple: how does BP plan to create value for shareholders as oil and gas demand declines?” said Mark van Baal, the founder of Follow This. “BP would rather antagonise its shareholders than answer it.”
Nick Mazan, from the Australasian Centre for Corporate Responsibility (ACCR), said: “Today’s result is unprecedented and demonstrates that investors are fed up with BP’s lack of capital discipline and its approach to shareholder rights.
“In our view it was a mistake for BP to expect to push through measures to undercut shareholder rights without resistance. Investors have communicated loud and clear to the company that brushing shareholders aside is unacceptable in public markets,” Mazan said.
Shareholders landed the blows against BP weeks after Meg O’Neill joined the 116-year-old company as chief executive, as the first external hire to BP’s top job and the first woman to hold the position at any major oil company.
O’Neill faces pressure from shareholders to revive BP’s flagging fortunes after its failed green agenda under its former boss Bernard Looney left the company’s market value lagging behind oil industry rivals, including Shell.
BP has watered down plans to reduce its oil and gas output in favour of growing its production, but the company’s resolution to scrap climate disclosures was criticised by investors.
Glass Lewis and the proxy advisory ISS urged shareholders to oppose BP’s proposal to scrap two previous resolutions requiring company-specific climate disclosures. The resolution was also opposed by LGIM.
