Neil Woodford criticises BP board for ousting ‘shouty’ chairman
Once-renowned investment manager Neil Woodford has criticised the BP board for ousting its ‘shouty’ chairman after less than a year in post.
Woodford called out the oil giant’s board for removing Albert Manifold after just eight months in the job, noting that he is the third chairman the company has been through in three years, claiming this makes BP look “ungovernable”.
In a Linkedin post on Friday, Woodford said shareholders should look away from the churn at the top and instead at “who is doing the churning”, arguing people should focus on the decisions made by non-executive directors rather than the chairman himself.
He said: “Most of the non-executive directors who pushed Manifold out have sat on that board throughout the entire period.
“The same people who have hired and fired chairmen and chief executives in quick succession remain comfortably in place.
“And the man they have just removed was the architect of BP’s turnaround strategy and the person who recruited the new chief executive in the first place. The board kept itself and discarded the one figure actually trying to change the business.”
Contesting standards
Woodford also contested the reasons for Manifold’s exit, claiming he was removed due to being a “bit dictatorial, a bit forceful, a bit too willing to drive change without waiting for the room to agree”.
Woodford argued this is only a “sackable offence in a British boardroom”, with many American chief executives having these characteristics and staying in post.
He added that the UK companies’ habit of not combining the role of chairman and chief executive also holds back growth, as “our governance regime frowns on it so heavily that no board would survive the shareholder resistance”.
Woodford also argued that boards now spend “at least half their time” on governance and other matters that add “nothing to the value of the business”.
He said: “The people charged with running genuinely complex, internationally significant companies are giving half their attention to exercises that create no value.
“It is no wonder those companies underperform their international peers. We should not be surprised that an economy drowning in regulation has produced boardrooms that are drowning in it too.”
BP troubles
Manifold was ousted earlier this week by the oil giant, with the company claiming there were “serious concerns” about his conduct.
Albert Manifold was stripped of his roles as chair and director of the London-listed petrochemicals giant having only taken the reins last July, with director Amanda Blanc saying the board had unearthed several cases of serious misconduct during his tenure.
The ousting was reportedly on account of his “volcanic” temper towards colleagues, which stretched to verbal abuse and bullying, leading the share price to fall sharply in the immediate aftermath before losses were pared back.
The decision extends a period of top brass turmoil at BP, which pushed out its previous chair Helge Lund just 10 months ago over concerns about his ability to oversee the energy giant’s re-embrace of petrochemicals.
Despite the volatility, BP’s share price has jumped 18.2 per cent since January, as the group capitalised on the oil price shocks caused by the Iran conflict.
Shares closed at 517.7p on Friday.