The City of London is in uproar this morning after BP’s former chairman broke his silence, accusing the board of spreading ‘lies’ to force his departure. The dramatic intervention comes as institutional investors call for a sweeping corporate governance overhaul at the oil giant, fearing a loss of market confidence.
In a blistering statement issued late yesterday, the ousted chairman declared: ‘I will not stand by while my reputation is shredded by falsehoods. The board’s claims are a smokescreen for their own strategic failures.’ His remarks have sent shockwaves through the Square Mile, with BP shares down 2.3% in early trading as the governance crisis deepens.
The chairman’s exit, initially attributed to ‘personal reasons’, is now widely seen as the result of a behind-closed-doors power struggle. Sources close to the board claim he was removed for failing to adequately oversee BP’s net-zero transition. But the former chairman counters that he was sidelined for questioning the pace of spending, warning that ‘rushing blindly towards net zero will destroy shareholder value’.
This is not just a spat between egos. This is a symptom of a broader malaise afflicting British plc. The City’s response has been swift and damning. The Investment Association, representing £8.5 trillion in assets, has demanded an independent inquiry. ‘Shareholders have lost faith in the board’s ability to separate fact from fiction,’ said its chief executive. ‘We require a full governance review, and fast.’
At the heart of the matter is a tension that has been building for years: should boards prioritise environmental targets or the bottom line? BP has been a poster child for the energy transition, but its shares have underperformed the sector by 15% over the past year. The ousted chairman’s crime, it seems, was to voice what many analysts whisper: that the market is starting to punish companies that sacrifice profits for pledges.
The government is also watching nervously. Any prolonged instability at BP, a FTSE-100 heavyweight and major taxpayer, could have ripple effects on gilt yields and the broader economy. The Treasury has already signalled it may review boardroom accountability rules if the company fails to restore order.
For now, BP finds itself in a classic trap: its internal turmoil is scaring off the very capital it needs to fund its transition. The lesson for other boardrooms is clear: governance is not a box-ticking exercise. It is the bedrock of market confidence. And when that confidence cracks, the price is paid in falling share prices and fleeing investment.
The chairman’s next move will be crucial. He has hinted at a full public defence, saying ‘the truth will out’. But in the City, truth is a rare commodity. What matters is who controls the narrative. Right now, BP is losing that battle.
