New BP CEO Identifies the Devastating Problem for the Fossil Fuel Sector (Spoiler Alert: Her Name is Jo)

Now that the up-and-coming generation of workers is fully aware of the forces behind climate change, leading fossil fuel companies are faced with a catastrophic loss of talent. After all, who wants to work for a business that is all but guaranteeing destruction of the planet as we know it? Some of these companies may be already beyond saving, but others are stepping up to address current and future employee concerns, including the global oil giant BP.

After false start, BP pivots to renewable energy

BP has come a long way since 2010, when its leadership was exemplified by then-CEO Tony Hayward. His infamous “I’d like to have my life back” quip followed months of other insensitive comments during the catastrophic Deepwater Horizon oil spill in the Gulf of Mexico.

Adding to the hurt, the Deepwater disaster blew the green sheen off BP’s “Beyond Petroleum” public relations campaign. The campaign was already notorious for greenwashing, mainly because it launched in 2000, when no way to get “beyond petroleum” actually existed.

At the time, wind and solar power were still expensive technologies with limited commercial application, and General Motors was the only auto manufacturer making electric vehicles for the public. GM began producing its ill-fated EV-1 car for lease in 1996, but almost nobody was interested. A mere 1,100 rolled off the assembly line and GM clawed back all but a handful by 2001.

Everything has changed since then. Wind and solar power are coming into competition with fossil fuels, energy storage costs have dropped, millions of electric vehicles are set to hit the road in the coming years, and green hydrogen is providing a pathway for decarbonizing heavy industry.

BP has been among the legacy fossil companies to realize how rapidly the global energy landscape is shifting. In 2017 the company took a dramatic step in the right direction when it acquired a $200 million stake in the leading solar company Lightsource.

BP also continued to grow its oil and gas business, but in the meantime it began investing in electric vehicle charging and other clean technologies.

This past spring, BP announced a flurry of clean tech moves including a major new green hydrogen project in Australia, and an onshore wind farm in the U.S. The company also announced the sale of almost all of its petrochemical assets.

The people problem at the heart of the fossil fuel problem

These moves are all well and good, but BP’s continued footprint in the fossil fuel economy has hampered its efforts to attract and retain talent.

That appears to be changing. On May 27, BP’s new CEO, Bernard Looney, made his first appearance at a BP annual general meeting, and he chose to highlight the talent issue.

“Last year – when we met in Aberdeen – we heard from a shareholder called Jo Alexander,” Looney recounted. “Jo used to work for BP – for 10 years – but left 5 years ago. She said she felt – at the time – that bp’s corporate purpose was not consistent with her inner purpose.”

On a second meeting with Looney, Ms. Alexander agreed to re-join the company.

Her decision to re-join marks a significant change for BP. When she left the company, she did not simply leave. She went to work with the U.K. responsible investment charity ShareAction and the professional group On Purpose.

For her On Purpose profile, Alexander wrote that she enjoyed her time at BP, but her role at the company was “at odds with her passion for the planet, our need to reduce carbon emissions and the impacts of climate change.”

In 2018 Alexander co-authored a Union of Concerned Scientists blog post titled, “BP’s Hypocrisy on Climate Policy,” in which the lead author Kathy Mulvey excoriated the company for its aggressive campaigns against climate action legislation in California and Washington State, even as it purported to support the 2015 Paris Agreement on climate change.

As for her new position at BP, Alexander’s LinkedIn profile makes it clear that she intends to have a broad impact.

“I am leading the development of an integrated plan for BP to engage its 73,000 employees about purpose,” she writes. “That will start with meaningful dialogue. I will create an environment where staff can do work that is meaningful to them and delivers BP's ambitions.”

Expect to see more Jo’s at BP

The big question is whether or not BP intends to follow through. Looney provided part of that answer last week, when he told Daniel Leal-Olivas at The Times that the company needed to take employee concerns to heart.

“Oil is increasingly becoming socially challenged, there’s no question about that,” Looney said. “I would talk about the people we’ve hired into BP in the past six months that we would have struggled to hire had we not [changed direction].”

Last week Fortune also took a deep dive into Looney’s newly unveiled decarbonization plan for BP. The new plan lends more detail to Looney’s previously announced pledge that BP would become a net zero company by 2050.

The new plan also lends more credibility to the sale of BP’s petrochemical assets, as it involves cutting oil and gas production by 40 percent within the next 10 years, toward a goal of 75 percent less than the company’s peak.

“The sense that investors were really beginning to push, and question our purpose, started to weigh on the financial performance of our sector,” Looney told Fortune. “And our employees were becoming anxious about what I would describe as their personal purpose being misaligned with our corporate purpose.” 

What Big Tech can learn from Big Oil

BP still has a long way to go, but its focus on employee values could provide it with an edge over other competitors as the global economy decarbonizes.

Other sectors would do well to follow BP’s lead. In the tech sector, for example, employees are speaking out on issues of profound social concern, including the pandemic, and the reaction has been mixed.

That includes Amazon, which continues to provide cloud services to oil and gas companies despite repeated entreaties from employees to support its own climate plan with meaningful action.

On civil rights, employees at Google and Microsoft have raised alarms over the use of facial recognition technology and other algorithms by immigration officials and law enforcement agencies.

The threat of a brain drain also has tech firms and other companies scrambling to address other potential hot spots, from privacy issues to LGBTQ rights.

As generational attitudes shift toward environmental action, human rights and civil rights, corporate leaders will have to continue to adjust to a new reality.

Be sure to sign up for the weekly Brands Taking Stands newsletter, which arrives in your inbox every Wednesday.

Image credit: Adzim Musa/Unsplash