LONDON (Reuters) – The new Chief Executive of BP Plc
Browne resigned unexpectedly on Tuesday after it emerged he had lied about how he met a gay former lover during legal proceedings to prevent a UK newspaper publishing details of the affair. Browne was one of the most respected business leaders of his generation, taking BP from an also-ran in the oil business to the second-largest non-government controlled oil company in the world, before BP slipped to third place last year as safety lapses and pipeline leaks hit performance.
Some industry executives suggested a personal style that one banker described as “presidential” may have contributed to BP’s recent woes by making Browne less approachable.
Hayward — a boyish-looking 49 year-old — is seen by those who have dealt with him as a more down-to-earth person than the sometimes distant, and always immaculately-groomed, Browne, who was knighted by Queen Elizabeth and appointed to Britain’s House of Lords by Prime Minister Tony Blair. Like Browne, Hayward is a career-long BP employee but industry executives expect a less slavish work-life balance from the new CEO.
Unmarried and without children, BP was Browne’s life, people who knew him said, while Hayward enjoys taking time off with his wife and two children.
“I don’t work at weekends apart from some Sunday evenings and I take all my holidays,” he told a BP magazine last year.
BP was forced to scale back its oil and gas production growth targets earlier this year, due to industry-wide problems with access to new fields and rising costs.
Regaining a strong growth profile for BP will be a main focus of Hayward’s early tenure, analysts said. This could be helped by a change in BP’s structure. Earlier this year, Neill McMahon, oil analyst at Bernstein, said BP should consider dropping its system of independent business units, which was advanced by Browne.
These units operate as separate profit centres whereas rivals like Exxon Mobil Corp use a more centralised structure where responsibilities focus more on functional activities.
Other analysts have suggested BP could “high-grade” its portfolio of oil fields by floating off its North Sea assets in a separate company.
This could boost the London-based company’s production profile by increasing its focus on higher growth areas.
Some investors would like BP to sell its refineries, which earn lower profits than oil production brings, and focus entirely on the upstream business.
However, BP executives said Hayward was unlikely to make any major changes quickly.
John Browne will probably be best remembered for his environmental activities. He was the first CEO of oil major to publicly acknowledge global warming and encourage CO2 caps, prompting other oil companies to address the issue.
While Browne said last month at BP’s Annual General Meeting that environmental sustainability was now “written into the DNA” of BP, some observers have questioned whether Hayward shares Browne’s dedication to green issues or his fondness for the accolades this brought.
However, a BP spokesman said BP would continue its support for action on global warming and investment in green technology under Hayward.