Bernard Looney’s Transition at BP:
BP is moving from being an oil company to an integrated energy company, a complex task led by Bernard Looney, who has been with BP his entire career.

Bernard Looney’s Connection to Norway:
Looney has a personal connection to Norway, as its chairman is Norwegian, and he has close friends there. He has visited popular tourist destinations in Norway, such as Preikestolen, Arland, and Stavanger, and enjoys the restaurant Tango in Stavanger.

Importance of In-Person Interaction:
Looney believes that in-person interaction is important for effective communication and connection with the audience. He felt more energized and connected when presenting BP’s strategy and results in person after two years of virtual presentations.

Irish Humility and People Skills:
Looney attributes the success of Irish people with people to a healthy dose of humility. He believes Irish people are always looking to make friends, improve, and get on in life. This humility and people-centric approach makes Irish people welcome in almost every country.

Bernard Looney’s Humble Beginnings:
Looney grew up on a farm in Ireland, the youngest of five children. His mother instilled in him the importance of education as a means to a better life, sending him to university despite his initial desire to work in construction. Looney graduated with a degree in electrical engineering, following in the footsteps of his older brother, Ray, who had aspired to be an electrical engineer but couldn’t afford to attend university.

Looney’s Career Journey with BP:
Looney joined BP in 1991 and worked in various roles across the world, including in Scotland, Vietnam, Texas, and Alaska. He highlights his time drilling wells in the Gulf of Mexico as one of the most enjoyable and rewarding experiences of his career.

Looney’s Perspective on Loyalty and Commitment:
Looney values commitment over blind loyalty, emphasizing that he wants employees who are dedicated to the company, their team, and the goals they are striving to achieve. He believes that loyalty can sometimes lead to people becoming enthralled by something, whereas commitment reflects a deeper sense of purpose and dedication.

Looney’s Reflections on Becoming CEO:
Looney admits that when he joined BP in 1991, he didn’t even know what a CEO was. He contrasts this with today’s job applicants in their 20s, who are well-informed about the company’s annual and sustainability reports.

Bernard Looney’s Journey to Becoming CEO:
Bernard Looney’s career at BP spanned various roles, and he initially had no aspirations for the CEO position. His appointment as CEO was unexpected, and he was informed of his selection by the company’s Norwegian chairman, Helge Lund.

Transition from Oil Company to Integrated Energy Company:
BP is undergoing a significant strategic shift from being an international oil company to an integrated energy company. This transformation involves a three-part strategy: resilient hydrocarbons, convenience and mobility, and low-carbon energy. The company aims to reduce hydrocarbon volume by 40%, drive down emissions, and invest in five growth engines related to hydrogen, bioenergy, and EV charging.

Stakeholder Engagement and Refining the Strategy:
Looney acknowledges that the company could have communicated its strategy more clearly initially. He emphasizes the importance of engaging with stakeholders to gather feedback and refine the strategy over time. The company’s stakeholders have played a crucial role in shaping and clarifying the transition strategy.

Navigating the Pandemic and Restructuring:
BP faced challenges due to the pandemic-induced oil price collapse and a significant drop in share price. Despite these difficulties, the company decided to continue with its reinvention efforts and implemented the largest restructuring in its 112-year history. Looney highlights the importance of pushing forward with the restructuring to align the organization with the new vision and strategy.

Industry Trends and Societal Expectations:
Looney acknowledges that BP’s early transition plans have been followed by other integrated energy companies. He emphasizes the need for companies to align with societal demands for clean, reliable, and affordable energy to ensure long-term success. Defying gravity: adapting to societal expectations and providing what society both wants and needs is essential for the company’s survival.

Working with National Oil Companies:
BP collaborates with national oil companies that may not have similar transition plans. The company focuses on delivering value to its stakeholders and creating opportunities in the energy transition space. BP’s capabilities, assets, brand, and experience can be applied to growing sectors like EV charging and bioenergy, offering exponential growth potential.

Balancing Capital Allocation and Shareholder Expectations:
Looney addresses concerns about allocating capital to low-margin businesses while oil and gas operations have higher margins. He emphasizes the importance of investing in growth engines that align with the energy transition and societal demands. BP’s increasing electricity sales in EV charging demonstrate the potential for profitable ventures in low-carbon energy.

BP’s Three-Part Strategy:
BP’s strategy is not a simple shift from oil to renewables. It involves three parts: hydrocarbons, convenience and mobility, and low carbon. Hydrocarbons remain core to BP’s strategy, with a focus on lower emissions and generating cash flow for the transition.

Advantages in Bioenergy:
BP has one of the largest trading organizations in the world, enabling it to secure feedstock for bioenergy. BP can leverage its existing refineries to build bioenergy plants, improving capital efficiency. BP has a strong customer base in the aviation industry, including every customer airline worldwide, providing a ready market for sustainable aviation fuel.

Returns in Bioenergy:
BP expects to achieve returns of 15% to 20% in bioenergy, comparable to its returns in hydrocarbons. The volatility of earnings in bioenergy is different from that in oil and gas commodities, offering diversification benefits.

EV Charging Advantages:
BP has a large physical presence with gas stations, with 550 million people living within 20 minutes of a BP station. BP’s brand is instantly recognizable, and it has a strong convenience offer, with 60% of customers in Britain visiting BP gas stations for non-gasoline purchases. BP has decades-long relationships with car manufacturers, such as Mercedes and Daimler, enabling it to enter the dashboard of electric vehicles.

The Role of BP in the Energy Transition:
BP aims to make the energy transition easier for its customers, particularly in countries like Norway, where electric cars are rapidly gaining popularity. BP’s strategy is to leverage its existing strengths and skills to create value for shareholders during the transition.

Ownership of Integrated Oil Companies:
The Norwegian oil fund believes that someone needs to own the big integrated oil companies. Selling these companies and improving their environmental footprint is not a simple solution.

BP’s Long-Term Investment Strategy:
BP aims to be a long-term owner and partner with companies that have significant patent portfolios and opportunities to contribute to a greener future.

Investor Influence on BP’s Decisions:
BP acknowledges that shareholders influence its actions and decisions. The company engages with investors to understand their perspectives but ultimately relies on management’s judgment to make the best decisions for the company.

Legal Challenges and Net Zero Targets:
BP believes that courts should not determine net zero targets, as the company is taking proactive steps to transition to net zero as quickly as possible.

The Pace of BP’s Transition:
BP emphasizes that the transition to net zero is a gradual process and that it is investing heavily in growth transition businesses.

Windfall Tax Controversy:
BP opposes a one-off tax on its windfall profits, arguing that the company has experienced periods of loss and that it needs to invest heavily in the transition to net zero.

BP’s Role in the Energy System:
BP sees its role as keeping the energy system flowing, providing energy to countries in need, and accelerating the transition to net zero.

Dealing with Governments:
BP avoids political involvement and focuses on aligning with countries’ objectives, particularly in terms of energy provision.

Cultural Change at BP:
BP recognizes the challenge of changing its corporate culture and acknowledges that it operates with different teams and values across 60 countries.

Agile Technology Implementation:
BP is adopting agile technology and organizational structures to accelerate decision-making and drive innovation.

Encouraging Inclusivity and Digitalization:
BP aims to foster a more inclusive culture, promote digitalization, and invest in digital transformation to drive the company’s progress.

Creating an Agile and Meritocratic Organization:
BP transformed its organizational structure by assessing roles for necessity, reducing layers of management, and increasing bands of control. The company selected leaders to lead effectively and bring diverse perspectives to drive change. BP hired executives from various industries, including technology, finance, and retail, to inject new talent and ideas. The restructuring resulted in a diverse and capable leadership team with a focus on tackling global energy challenges.

Fostering Objective Meritocracy:
Objective meritocracy is a core principle at BP, ensuring that individuals are evaluated based on their job performance and contributions, regardless of background or personal characteristics. BP aims to provide equal opportunities for all employees to succeed and be recognized for their achievements. The company acknowledges inherent biases and actively works to eliminate them, striving for a meritocratic and inclusive culture. BP’s leadership team reflects a commitment to gender equality, with a 50-50 representation of men and women in executive positions.

Importance of Talent and Trust in Organizational Success:
The key to organizational success lies in attracting and retaining the best talent. Meritocracy is essential for identifying and promoting the most capable individuals, leading to better performance and innovation. A meritocratic system also enhances employee morale, job satisfaction, and commitment to the organization. Building trust with stakeholders, including the general public, is crucial for organizational reputation and long-term success. Reflecting on actions and understanding stakeholders’ perspectives are important steps in rebuilding trust and maintaining positive relationships.

Effective Communication and Engagement:
Genuine engagement and listening are key to effective communication. Rather than focusing on delivering talking points, leaders should ask questions, listen actively, and learn from interactions. Social media platforms like LinkedIn provide opportunities for engagement, sharing, and listening to diverse perspectives. Transparency and addressing tough comments are essential in building trust and fostering open dialogue with stakeholders.

Authenticity in Leadership:
People prefer to work for real people, not heroes who always have the answers. Authenticity starts with admitting “I don’t know” when you don’t have the answer. A culture where leaders must always have an answer can lead to fabricated information and dangerous decision-making.

Importance of Dialogue and Respectful Disagreement:
Engage in respectful dialogue even with those who hold different opinions. Appreciate and acknowledge others’ perspectives, even if you disagree.

Bernard Looney’s LinkedIn Usage:
He receives three emails per week from his team highlighting key topics and seeking his input. He spends about five to ten minutes reading and responding to these emails. Authenticity is crucial; corporate or inauthentic content is pointless and ineffective.

Key Leadership Qualities:
Bernard Looney values leadership qualities such as: Curiosity and a desire to learn continuously. Empathy and the ability to understand and connect with people. Integrity and honesty, even if it means admitting “I don’t know.” Courage to make tough decisions and stand by them. Humility and the willingness to listen and learn from others.

Openness:
Encourages receptiveness to new ideas and learning from others. Emphasizes exploring brilliant companies and actively seeking knowledge.

Authenticity:
Promotes genuine and transparent interactions. Cultivates trust and strengthens relationships.

Empathetic Edge:
Advocates for empathy and compassion towards others. Highlights the importance of difficult performance management conversations and accountability. Balances empathy with assertiveness and edge.

Grit and Self-Improvement:
Demonstrates a relentless pursuit of personal and professional growth. Emphasizes the value of self-reflection and continuous improvement.

Mental Health Awareness:
Recognizes the prevalence of mental health challenges and the importance of addressing them. Encourages open discussions about mental health and seeking support.

Addressing Mental Health:
Bernard Looney emphasizes the importance of acknowledging and addressing mental health issues in the workplace and beyond. He encourages people to talk openly about their struggles, breaking the stigma and creating a sense of understanding and support. By acknowledging that everyone faces challenges, he believes it can free up mental space and allow individuals to focus on their work and personal lives more productively.

Personal Experiences with Mental Health:
Looney admits to having his own struggles, highlighting that mental health issues are not limited to specific individuals or positions. He acknowledges the anxiety and nervousness that can accompany public speaking and decision-making, emphasizing that these are common experiences. He stresses the importance of creating an environment where it is acceptable to not be okay, encouraging people to seek support and understanding.

Climate Change Awareness:
Looney discusses the growing awareness and action taken by companies regarding climate change, moving from words to numbers and concrete actions. He attributes this shift to education, the pervasive reach of social media, and the increasing association between weather events and climate change. Looney believes that climate change has become more tangible and local, with events like floods in Germany being directly linked to climate change. He anticipates that the trend of localizing climate change issues will accelerate, making it more relevant and pressing for individuals and communities.

Impact of the Pandemic:
Nicolai Tangen suggests that the pandemic may have contributed to the increased awareness of climate change due to the heightened belief in science and the visibility of clean skies during lockdowns. Looney acknowledges that the pandemic may have played a role, but he believes that education and the interconnectedness of the world have been more significant driving forces. Tangen draws a parallel between astronauts’ perspectives of Earth from space and the pandemic’s effect on people’s awareness of global issues.

BP Oil Spill:
Looney describes the 2010 Gulf of Mexico oil spill as the most challenging time in his career. The oil spill led to legal actions against BP, including a lawsuit by the oil fund.

Personal Impact:
The Deepwater Horizon accident resulted in the loss of lives, causing deep emotional pain and grief for the families of the victims.

Environmental and Community Impact:
The accident had a significant environmental impact, although less severe than initially projected. Local communities were also affected by the disaster.

Company Impact:
The accident shook the company to its core, as it challenged its safety culture and reputation. The ongoing media coverage of the crisis further compounded the difficulties faced by the company.

The Toll on Company Employees:
The 60-day non-stop effort to stop the well took a heavy toll on the employees, straining their personal lives and relationships.

Lessons Learned:
The accident instilled a sense of humility within the company, acknowledging the possibility of errors and the need for continuous learning. The importance of humility in an increasingly complex world was recognized as a valuable attribute for a stronger company.

Legacy and Remembrance:
The company adopted the phrase “We will never forget” to ensure that the lessons learned from the accident are never forgotten by new employees.

Advice for Aspiring Leaders:
Treat others as you want to be treated, and focus on making a positive difference while maintaining strong relationships.