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A group of 48 institutional investors has called on the BP to give shareholders a vote for each plan from the oil Major to support its climate goals, creating a possible clash with the defense fund of US activist Elliott Management.
Investors intervention, including Rathbones Management Management, Phoenix Group, Robeco and Royal London Asset Management, follows a promise from BP chief executive Murray Auchincloss to “radically” group strategy in the face of Elliott to increase performance.
Elliott has built nearly 5 percent of the shares in BP and is pushing Auchincloss to divert important parts of the business, including some of its green energy investments, the Financial Times reported last week.
But other investors are worried that Auchincloss will give up climate commitments and focus on oil and gas production on a London investor day next Wednesday.
“The BP has previously offered a shareholder vote on its transition strategy and we expect a similar level of responsibility to be preserved for future material strategy changes,” investors said this week in a letter to BP Helge Lund’s leader , seen by ft.
The group has a 2.5 percent combined shares of BP, according to FT calculations, just over half of Elliott’s shares, underlining the impact of the defense fund as the company evaluates its options.
The demand increases the pressure on Lund and Auchincloss before the investor’s day, which is seen by Elliott and other shareholders as an essential test of Pb leadership.
According to an industry decarbonization strategy, led by Lund and former executive chief Bernard Looney, the company in 2020 pledged to cut oil and gas production by 40 percent by 2030.
Two years ago she attracted that commitment to a 25 percent landing and some investors expect the goal to be completely removed.
Auchincloss, who was named in January 2024, has already described new oil and gas costs that analysts wait will keep the production of BP at current levels. BP remains the only main oil and gas with a difficult target to reduce production.
If the production target is to be reduced or removed, the shareholders want the BP to disclose more detailed information about its expenses for fossil projects to ensure that it will continue to reduce emissions and there is no clogged assets as the request of oil falls.
“We need a clearer picture of the sustainability and approximation of this spending with Paris’s goals,” said Carola Van Lamoen, head of sustainability in Robeco, referring to the 2015 KB Climate Agreement.
In 2022, 88 percent of BP shareholders voted in favor of the company’s strategy, including the commitment to reduce oil and gas production. The group has not offered shareholders a vote on the decarbonization strategy since then.
Given the changes that Auchincloss is expected to announce next week, “it is time to request that the shareholders be given the opportunity to vote (strategy) in AGM 2025,” the investors said on paper.
BP confirmed that he had received the letter, adding that he would respond in a timely manner.
Lund, a former chief executive of the Norwegian Equinor Energy Group, has been chairman of the PB since 2019 and was useful in the development of his current strategy. Auchincloss has been on board since 2020 and was the main financial officer before receiving high work.
While Elliott has not publicly declared his expectations, the defensive fund wants to see a “basic pivot”, according to a person familiar with his thinking.
This does not have to imply short -term growth in oil and gas production, but should include “strong capital allocation, proper size (and) a displacement plan”, the person added.
Elliott refused to comment.
