£32m scandal | Ex-BP chief pays heavy price for failing to disclose workplace relationships

Ex-BP chief pays heavy price for failing to disclose workplace relationships

The former CEO of BP has paid a heavy price - £32 million in fact - for failing to tell the board about past relationships with colleagues.

BP has cut over £32million ($40 million) in remuneration from former CEO Bernard Looney, after the British oil giant concluded he had knowingly misled the board.

Looney had announced in September that he would resign after revelations of personal relationships with company colleagues surfaced, prompting the company to launch an investigation.

That followed similar claims the board investigated in May 2022. During that review, Looney disclosed "a small number of historical relationships with colleagues prior to becoming CEO."

No breach of the company's code of conduct was found at the time and the board was given assurances by Looney "regarding disclosure of past personal relationships, as well as his future behaviour."

Looney’s resignation included a 12-month notice period but BP's board has now dismissed him with immediate effect for serious misconduct. The company said he would receive no further salary or benefits from the dismissal date, and would not be paid an annual bonus for fiscal 2023.

The board is still seeking his permanent replacement.

BP said Looney's remuneration package was cut by £32.4 million pounds ($40.53 million), with 87% of that due to his resignation in September. A further 10% will be recouped as a result of the board's decision to dismiss Looney for serious misconduct, and a further three percent was clawed back at the discretion of the board.

"I am disappointed with the way this situation has been handled," Looney said in a statement.

CEOs in the spotlight over workplace relations

Looney joins other high-profile executives who have lost their jobs in recent years over accusations of improper conduct with employees.

In April 2023, NBCUniversal’s Chief Executive left the company after similar news emerged of an “inappropriate relationship” with a female employee.

Jeff Shell issued a statement to the workforce that read: “Today is my last day as CEO of NBCUniversal. I had an inappropriate relationship with a woman in the company, which I deeply regret.”

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He went on: “I am truly sorry I let my Comcast and NBCUniversal colleagues down, they are the most talented people in the business and the opportunity to work with them the last 19 years has been a privilege.”

The statement did not elaborate on the nature of the relationship or what constituted ‘inappropriate’ conduct. However, CNN reports that the NBC employee involved in the relationship had filed a complaint against Shell.

The Confederation of British Industry’s director-general, Tony Danker, was ousted earlier this year following complaints into his behaviour towards CBI employees.

The news prompted several more women to come forward with similar accusations levelled at senior leaders within the CBI, including claims of attempted sexual assaults, explicit images being sent to young female staff and even a report of rape.

Following his dismissal, Danker said he was "truly sorry" that he had "unintentionally made a number of colleagues feel uncomfortable” but added: "I was nevertheless shocked to learn this morning that I had been dismissed from the CBI, instead of being invited to put my position forward as was originally confirmed. Many of the allegations against me have been distorted.”

In 2019, Warner Bros Chairman and Chief Executive Kevin Tsujihara resigned as one of Hollywood's most powerful studios investigated a report that he improperly helped an actress obtain roles at the studio.

And in 2018, McDonald’s CEO Steve Easterbrook was sacked after having a consensual relationship with one of his employees.

Workplace relationship policies

Greg Guilford, Director of HR Consulting at WorkNest, previously spoke to HR Grapevine about what steps employers should take if they want to introduce a policy on office relationships.

“Employers can ask employees to disclose workplace relationships, especially if the relationship is between a manager and a direct report,” said Guilford.

“It’s important that you have all the appropriate policies in place, including a code of conduct, grievance procedure and rules on harassment. It is a sensible approach for employers to impose rules around personal relationships at work, with the aim of ensuring that individual members of staff are not open to allegations of impropriety, bias, abuse of authority or conflict of interest.”

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Guilford added that a policy could also cover break-ups and what’s expected still if a co-working relationship breaks down.

He explained: “This could include that it is a duty of those involved in the relationship to leave domestic issues at home and stress the need for professionalism at all times, even in the event of a failing relationship.

“Businesses must play it safe because there is a legal risk to them. Workplace romances could potentially provide grounds for an Employment Tribunal claim, including claims for sexual harassment, sex discrimination and victimisation.”

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