BP Considers Successors for Hayward
As Tony Hayward defended BP’s actions over the Deepwater Horizon oil spill before a panel of the US Congress on Thursday, he was battling for his own future as much as for that of his company.
It is a fight Mr Hayward appears to be losing. The suspicion that Mr Hayward’s days are numbered intensified after Mr Obama said earlier this month that the gaffe-prone Englishman: “wouldn’t be working for me after any of those statements”.
That aggressive tone coming from the White House has quietened since BP agreed on Wednesday to set aside $20bn in an independent claims account “This process may be seen as a necessity if BP is to have a long-term future in the US, and it should give BP a starting base for re-establishing its relationships with key US administrators and with the US population,” analysts at Collins Stewart wrote in a note on Thursday.
But the agreement comes at a price. To fund the $20 billion, BP has halted its dividend payments, angering some investors.
“I don’t get how [legally] BP can cancel an already declared dividend, and offer up $20 billion, without a shareholder vote. Nor why they’d do either of those things. If Obama insisted on a political headline, I’d have much rather it’d been Hayward’s scalp,” one trader said.
UK investors are not yet calling for Mr Hayward’s head. But as Gary Burnison, chief executive of KornFerry International, one of the world’s biggest headhunters, notes about Mr Hayward: “For better or worse, once Humpty Dumpty has fallen it’s very hard to put him back together.”
Knowing this, Carl-Henric Svanberg, BP’s relatively new chairman, whose own job is far from assured, is already seeking advice on possible candidates to replace Mr Hayward, according to two sources.
The most likely contenders are Bob Dudley, managing director overseeing the Americas and Asia, and Iain Conn, who runs BP’s refining and marketing arm.
Both men are members of BP’s board and were runners-up to Mr Hayward in the bid to succeed Lord Browne three years ago. Mr Conn, an ambitious Scotsman, has been managing BP’s daily operations from London since Mr Hayward decamped to Houston.
Byron Grote, BP’s chief financial officer, has also played a crucial role in overseeing daily operations but is already beyond BP’s retirement age and therefore seen as an unlikely candidate.
Mr Dudley, an affable Mississippian, meanwhile, has been in the fray in Houston, managing the clean-up and is seen as having handled the public scrutiny better than his chief executive.
He was also at Mr Hayward and Mr Svanberg’s side during Wednesday’s meeting with Mr Obama.
Mr Dudley’s recent post as chief executive of TNK-BP, BP’s Russian partnership, gives him experience running a company in a host country with an unpredictably hostile government.
BP wants to put neither man into Mr Hayward’s shoes immediately. BP’s board and Mr Hayward want to delay any management change at least until the well is capped.
Mr Hayward’s now infamous gaffe about wanting his life back belies his wish not to be seen fleeing the scene of the accident, people close to the chief executive said.