Glass Lewis has urged investors to vote against BP’s chair. The dispute focuses on a climate resolution that was blocked. Shareholder unrest is now front and centre.

Proxy advisers push back after resolution excluded

Glass Lewis, the influential proxy adviser, has recommended that shareholders oppose Albert Manifold, BP’s chair, after the board rejected a climate resolution that campaigners wanted debated at the company’s annual meeting on 23 April. The advisory firm said the decision to exclude the proposal raised questions about transparency, shareholder communication and how responsive the board has been to investors' concerns.

But this disagreement goes beyond just one motion. It has pulled in other parts of the shareholder ecosystem and set off a chain reaction that now threatens to make BP’s governance a proxy battleground. And it comes at a delicate moment for the company.

The resolution, put forward by Follow This, asked BP to publish its strategy under scenarios of falling oil and gas demand. BP’s board ruled the motion invalid, calling it ineffective and outside the scope of the meeting. The company's response — to stress it's focusing on simpler, standardised disclosures after engaging investors — did little to calm critics.

Investors and campaign groups organise

Follow This has marshalled support from institutional investors. The group disclosed that a bloc of 12 institutional investors intends to vote against BP's proposal to retire two existing climate-related reporting items. Mark van Baal, chief executive of Follow This, said shareholder pressure has grown since 2025 and that investors are increasingly unwilling to accept moves that reduce climate reporting.

Right now, another major proxy adviser, ISS (Institutional Shareholder Services), has also weighed in. ISS recommended that investors oppose BP's request to cancel the older climate proposals, arguing those items still serve a purpose. So both of the main global advisers have signalled resistance to parts of BP's approach to trimming its climate reporting framework.

Proxy advisers don’t always influence votes. But when both Glass Lewis and ISS are aligned against board proposals, it amplifies investors' room to manoeuvre. It also sharpens scrutiny of how boards decide which shareholder motions make it onto the agenda and which don't.

Management changes and strategic shifts

BP has undergone leadership churn. Meg O'Neill, who recently took the top job, is the company's fourth chief executive since 2023 and the first woman to hold the post. Her arrival coincides with a wider repositioning inside BP — a move back towards oil and gas after the firm’s earlier push into renewables yielded mixed results.

In a staff memo, Meg O'Neill acknowledged the ‘‘significant complexity’’ of the operating environment, pointing to geopolitical tensions, shifting energy demand and rapid technological change. She framed BP’s mission as delivering energy safely and reliably today while preparing for the future.

Mastheads

BP is responding to investor demands for industry-wide comparability by focusing on clearer, simpler disclosures. But some shareholders see the proposal to retire older reporting items as an attempt to narrow scrutiny rather than broaden trust.

Financial backdrop sharpens the debate

BP’s finances help explain why this issue is important. The group posted one of its strongest years in 2023, with net profits attributable to shareholders topping $15bn. Yet that momentum didn't last; results slipped in 2024 amid weaker refining margins and softer oil demand.

BP’s downstream operations — the refining, marketing and customer-facing side of the business — generate more than twice the revenue of its upstream activities, underlining where much of the company’s cash flow comes from. At the same time, BP’s capital spending allocation shows a mixed picture: about ten percent of capex in 2024 went to low-carbon sources, while exploration expenses more than doubled between 2021 and 2024.

This financial setup sheds light on the ongoing tension. Shareholders who want BP to pivot towards cleaner energy worry that cutting back climate disclosures reduces oversight at a time when oil and gas remain central to profits. Other investors and management argue that standardised, comparable reporting will help the market judge companies more fairly.

Corporate governance under the microscope

The row highlights a wider problem for large listed companies: how to balance investor demands for transparency with boards’ desire for control over agenda-setting. When a board rejects a shareholder resolution, it can be entirely within the rules. But those exclusions can also fuel the perception that management is shutting out inconvenient questions.

Experts say proxy advisers act as gatekeepers. They don't make votes — investors do — but their guidance shapes votes among asset managers who lean on such recommendations when making complex decisions across hundreds of companies.

Pressure grows when proxy advisers and vocal investors align. BP now faces not only the reputational issue of why it blocked the Follow This resolution but also the practical risk that more shareholders will support motions that the board wanted to retire.

Old scars and future choices

BP's history also looms large. The legacy of the Deepwater Horizon disaster in 2010 still colours how some investors view the company’s governance and risk controls. That episode severely dented earnings and dividends and left a long shadow over how BP manages environmental and operational risk.

Managers and shareholders face two challenges: reporting comparably across peers and keeping investor trust during strategic shifts. The competing answers are now playing out in proxy recommendations and in the voting intentions of large institutions.

Pressure from investors isn't theoretical. A number of institutional players have signalled they won't simply accept the company's request to remove existing climate reporting items from the agenda. If enough of them back Follow This or the proxy advisers’ guidance, BP could face embarrassing votes at its annual meeting.

Bottom line: the clash is less about a single resolution and more about who gets to define what shareholders can see and vote on — directors or those who own the stock.

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Meg O'Neill, chief executive of BP, said the operating environment involves "significant complexity."

This article was created with AI assistance.