The recent departure of BP chair Albert Manifold after just eight months has been widely portrayed as further evidence of dysfunction at the oil giant. However, an alternative interpretation suggests the board acted correctly by promptly addressing serious concerns about governance standards, oversight and conduct.
The non-executive directors considered whistleblowing complaints against Manifold and, with the agreement of new chief executive Meg O'Neill, deemed his behaviour unacceptable. Rather than smoothing over the issue, they removed him. This demonstrates the board fulfilling its duty to take such concerns seriously.
While the lack of transparency over specific allegations is regrettable, it is understandable. Manifold's appointment was always risky but not unreasonable given his successful track record at CRH and shareholder demands for results-focused leadership. Headhunters Egon Zehnder conducted rigorous checks.
Calls for senior independent director Amanda Blanc to step aside from the next chair search are misguided. Her role is not to impose a personal choice but to facilitate board consensus. Stand-in chair Ian Tyler will also be closely involved.
The damage need not be permanent if O'Neill delivers on her strategy for a simpler, stronger company. The solution is straightforward: ensure the next chair is up to the task.
