UK supermajor BP has appointed interim chief executive Murray Auchincloss as its permanent chief executive with immediate effect, at an annual salary of £1.45 million ($1.832 million) plus other compensation and benefits.

The appointment indicates a desire for continuity as the company proceeds with what BP chair Helge Lund described as its “disciplined transformation”.

Auchincloss had stepped up to the plate as interim chief executive when former chief executive Bernard Looney abruptly resigned four months ago, after Looney’s personal relationships with company employees during his tenure came to light. BP last month said that Looney “knowingly misled the board” when he failed to disclose the extent of these relationships.

Auchincloss, who has been at the helm of the UK energy heavyweight since September 2023 as interim boss, will also continue as a member of the BP board. 

BP said the appointment of Auchincloss was made “following a robust and competitive search process” carried out by the board over the past four months with support from international search advisors, which included “detailed consideration” of a range of candidates,  including external ones.

Opportunities and challenges

In the end, BP once again chose an internal candidate, with the company’s chair highlighting Auchincloss’ knowledge of BP and its energy transition strategy.

On Wednesday, BP chair Lund said: “The board is in complete agreement that Murray was the outstanding candidate and is the right leader for BP.

“Many already know Murray well, and few know BP better than he does. His assured leadership, focus on performance and delivery, and deep understanding of the opportunities and challenges in the energy transition will serve us well as we continue our disciplined transformation to an integrated energy company.”

Investors’ initial reaction was muted, as BP shares were around 1% lower in early London Stock Exchange trading, while the broader FTSE 100 index – of which BP is a constituent – was down around 1.5%.

Auchincloss said: “It’s an honour to lead BP — this is a great company with great people. Our strategy — from international oil company to integrated energy company, or IOC to IEC — does not change. I’m convinced about the significant value we can create.”

The search process for the new chief executive was led by a committee of BP’s board, headed by Lund together with three other non-executive directors. The appointment decision was approved by the full board, excepting Auchincloss.

Before becoming interim chief executive, Auchincloss had been the supermajor’s chief financial officer since July 2020, when he also joined the board.

Auchincloss had joined Amoco Canada in 1992. Following financial and planning roles in Canada and the US, his career included terms as commercial director for BP’s onshore North America business and as CFO for the company North Sea business.

The 53-year-old, who has a degree in finance from the University of Calgary and is a chartered financial analyst, is also a member of the Aker BP board.

Remuneration for new boss

In addition to his salary, the new BP chief executive’s remuneration will include provisions relating to bonus opportunity, bonus deferral and performance shares — in accordance with BP’s 2023 remuneration policy as approved by shareholders, and a cash allowance in lieu of pension equal to 20% of base salary, “in accordance with BP’s remuneration policy and aligned with the majority of the wider UK workforce”.

BP in December confirmed it would be withholding any outstanding salary that Looney was due to be awarded and would claw back part of his past bonuses, as part of the process that saw him abruptly step down in September.

The company said the former chief executive’s failure to disclose the extent of his personal relationships with company employees amounted to “serious misconduct” and, as such, Looney was dismissed without notice, effective on 13 December.

BP calculated the full value forfeited from Looney to total more than £32.4 million ($40.7 million), Upstream previously reported.