Personal Finance

BP’s Former CEO Forfeits £32 Million Pay on Misleading Board

(Bloomberg) — BP Plc’s former Chief Executive Officer Bernard Looney will forfeit as much as £32.4 million ($40.6 million) in pay after resigning in September because he lied about his personal relationships with other employees.

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“Mr Looney knowingly misled the board,” the company said in a statement on Wednesday. “The board has determined that this amounts to serious misconduct.”

The 53 year-old Irishman stepped down on Sept. 12 over his failure to fully disclose past relationships with colleagues. He was replaced on an interim basis by Chief Financial Officer Murray Auchincloss, who has been recused from all decision-making related to Looney, the company said.

The former CEO will receive no further salary, pension allowance or benefits from the date of his dismissal and will not be paid any annual bonus for the financial year 2023, according to the statement. Looney becomes the second FTSE 100 boss to lose their bonus in the past month, following NatWest Group Plc’s decision to slash the pay of ex-chief Alison Rose by £7.6 million after her resignation.

“I am proud of what I achieved with my colleagues during my time as chief executive officer of BP,” Looney said in a statement. “I am disappointed with the way this situation has been handled. And, as I look to the future, I want to simply wish everyone at BP all the very best.”

The bulk of the £32.4 million in potential remuneration for Looney was automatically forfeited on immediate effect of his resignation, according to the statement. About 10% of the loss in pay results from the board’s decision that Looney should be dismissed for serious misconduct.

BP will also claw back 50% of the cash portion of the bonus paid to him in 2022 and a portion of stock awarded to him through a performance share plan, totaling less than £1 million. The former CEO, who spent his entire career at BP, was originally paid £10 million last year, just exceeding his closest peer, the now-retired Shell Plc CEO Ben van Beurden.

BP continues to search for a permanent replacement for Looney, with headhunters carrying out an external search as well as considering internal candidates. Auchincloss has fended off speculation that BP has become a takeover target in its weakened state, saying its strategy remains in place.

(Updates with statement from Looney in the fifth paragraph.)

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