BP's chair Albert Manifold faced a significant investor backlash after blocking a shareholder resolution from Dutch activist group Follow This, which would have required the oil giant to outline how it would protect shareholder value amid declining oil and gas demand. The move was widely seen as an overreach that backfired, leading to defeats on other proposals and a notable protest vote against Manifold himself.
Resolution Blocked Despite Investor Support
The Follow This resolution was framed in investor-friendly terms, merely asking BP to describe its strategy for safeguarding shareholder value if demand for fossil fuels falls. The group claimed backing from investors managing $1 trillion in assets. However, Manifold and the board, after taking legal advice, declared the resolution invalid without providing a specific reason. Critics argued that even if the resolution did not meet formal requirements, the board could have negotiated to include it in some form, as is common practice.
Shell's Contrasting Approach
Shell, facing a nearly identical resolution from Follow This for its upcoming annual meeting, took a different approach. Chair Andrew Mackenzie allowed the motion to proceed without fuss, dedicating a full page in the meeting notice to the proposal and supporting statement, followed by the board's recommendation to vote against it. This mature and confident style respects shareholder democracy, whereas BP's heavy-handedness invited rebellion.
Rebellion on BP's Own Proposals
The fallout from the resolution exclusion was immediate. A BP proposal to remove specific climate reporting requirements adopted in 2015 and 2019, which the board deemed duplicative, received only 47% support, far short of the 75% needed. Another proposal to eliminate in-person annual meetings also failed. Most embarrassingly, 18% of votes were cast against Manifold's re-election, a strong rebuke for a chair in his first year. Legal & General Investment Management, a top-10 investor, cited the blocking of the Follow This resolution as a reason for its opposition.
Boardroom Dynamics Questioned
The presence of heavyweight non-executives, including Aviva CEO Amanda Blanc and former Barclays finance director Tushar Morzaria, raises questions about whether they warned Manifold against the approach. Some observers suggest BP has become the "Albert Manifold show," where the chair's decisions dominate. While Manifold's strategy of pivoting back to oil and gas to boost the share price may have majority support, the manner in which debate was stifled undermined trust.
The episode serves as a reminder that even when a board believes it has the right strategy, it must allow shareholders to have their say. Manifold's obstinacy was counterproductive, and the shareholder kickback was deserved.
